Kenya proposes new law to provide stipends to jobless workers

In a move to protect vulnerable workers during periods of economic upheaval, the government is seeking to introduce the Social Protection Bill, 2025, which would provide monthly stipends to individuals who lose their jobs due to unforeseen economic, environmental, or social disruptions.

This new measure is a significant expansion of the existing social safety net, which currently focuses on aiding the elderly, persons with disabilities, and orphans.

Under this Bill, individuals impacted by job losses due to economic shocks like the Covid-19 pandemic will receive direct financial assistance to help them cope during periods of unemployment.

The Covid-19 pandemic brought widespread job losses, with nearly two million people losing their livelihoods.

Recognizing the devastating impact such crises can have on workers, the Bill seeks to extend assistance to those who face joblessness as a result of similar economic shocks.

"Shock" is defined in the Bill as any sudden, high-impact disturbance, whether economic, ecological, or social, which negatively affects the well-being of individuals or communities.

The Bill, tabled by Majority Leader Kimani Ichung’wah, is set to alleviate the strain on Kenyans who have been left vulnerable by these unpredictable shocks.

Currently, social assistance is limited to certain vulnerable groups, but the new Bill would widen the scope to include workers affected by mass layoffs.

It proposes providing these workers with monthly stipends to cover basic needs and reduce the economic pain caused by job losses.

The government-backed initiative represents a shift from the previous administration’s attempt to set up an unemployment insurance fund (UIF), which would have required employers and employees to contribute a percentage of salaries to a fund.

The UIF was aimed at providing short-term relief but was eventually abandoned. In contrast, this new model would see the government directly funding the support using taxpayer money.

Kenya has already committed a significant amount of money to social protection initiatives, with around Sh31.3 billion allocated for various welfare programs in the year ending June.

The proposed Bill would bolster these efforts, establishing a National Board for Social Protection to manage the beneficiaries and update records through national registries.

The board will be responsible for ensuring that those in need of assistance are identified and provided for promptly.

In addition to the cash transfers, the Bill also includes provisions for other types of social care services, such as rehabilitation, psychosocial support, and respite care, all designed to help individuals regain their footing after losing their jobs.

Other social care services could include feeding programs, home-based care, and skills-building initiatives aimed at preparing individuals for re-entry into the workforce.

While the South African model of unemployment insurance requires contributions from both employers and employees, Kenya’s approach relies on direct government support.

This non-contributory system, similar to Australia’s social security benefits for unemployed job-seekers, would provide vital support for individuals who find themselves without work due to external shocks.