Kenya Power lays-off employees as a measure to cost-cutting

Kenya Power lays-off employees as a measure to cost-cutting

In these uncertain times, another hit comes to the Kenya Power Supply board, where they have to shrink their workforce drastically to meet the ends. In an official statement they mentioned, over the last four years, the company has experienced a general decline in its financial situation as depicted by reduced net earnings. In a bid to turn around and transform the financial performance of the company; improve efficiency and enhance customer experience, KPLC is eyeing a phased reduction in workforce to ensure KPLC remains competitive and provides the right levels of service. Struggling in the scenario, they are set to retrench a number of their workers in a bid to cut costs and return to profitability.

Though, it is still not clear that how many of its employees are targeted in the power distributor sector whose jobs will be laid off, as the company currently employs over 10,000 in the country.

 Through their annual reports, it is observed that Kenya Power spent over 17.4 billion on salaries and wages in its last financial year ending in June 2020. Even though, their workforce shrank from 10,914 to 10,481 employees. Despite most of the connections yielding meagre income, there have been accusations and doubts that the finance was mismanaged and wrongly implemented resulting in costs inflation.

To cover for its mounting financial woes, Kenya Power has floated an Expression of Interest for refinancing of its Ksh54.6 commercial debt. Trying to stay afloat, the company has been borrowing an average of Ksh7 billion in the last 15 years, a move that has ballooned its debt to Ksh109.9 billion as of June 2020 from Kshh4.1 billion in 2004. Citing as one of the biggest reasons for their loss, they disclose that the company also suffers from poor sales collection, theft of electricity and defaults by big customers, including government ministries.