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High cost of goods and services, tight budget to dull Christmas festivities
This year’s Christmas festivities stand out as one of the most expensive for Kenyans yet.
What you need to know:
- The cost of other basic household goods such as milk, meat, tomatoes, vegetables, fuel, electricity and rent have all increased compared to last year
- Households to pay more to buy a similar quantity of goods and pay for the same quality of services that are key in making merry this Christmas.
When Robert Ndugire’s family gathered to celebrate Christmas a year ago, the price of a 400-gram loaf of bread was Sh45, a 3-litre cooking oil jar cost Sh570 while a six-kilogramme cooking gas cylinder was priced at Sh850.
The three items which cost Mr Ndugire a total of Sh1,465 only 12 months ago will now cost him Sh2,311, an increase of Sh846 on only three basic household goods, yet his kitchen requires tens of other essential supplies to guarantee his family a merry Christmas.
The price of a 400-gram loaf of bread now goes for Sh55, a 3-litre cooking oil jar is priced at about Sh956, while the cost of a six-kilogramme cooking gas cylinder has risen to Sh1,300; indicating the sharp rise in inflation in a year when most Kenyans’ income has either stagnated or dropped as per Kenya National Bureau of Statistics (KNBS) data.
This year’s Christmas festivities stand out as one of the most expensive for Kenyans yet, amid sharp rises in the prices of basic commodities including food and fuel.
The cost of other basic household goods such as milk, meat, tomatoes, vegetables, fuel, electricity and rent have all increased compared to last year, raising the overall cost of living in the country to the detriment of millions of poor households.
KNBS data shows the price of cooking oil has risen by 67.7 percent, sugar has increased by over 10 percent, tomatoes by 15 percent, cooking gas by 29 percent, and fuel by 22 percent. The annual year-on-year inflation, new taxes, and supply shortages have all combined to sharply increase the prices of the essential products.
This will force households to pay more to buy a similar quantity of goods and pay for the same quality of services that are key in making merry this Christmas and new year festivities, forcing them to tighten their spending to remain within budget.
Kenyans who spoke to the Nation indicate that they have cut on spending, particularly travel and luxurious products, as they strive to stretch the little cash in their pockets.
Christmas spending
“The cost of living has gone up yet earnings are still the same... look at the price of cooking gas and a loaf of bread which is at its highest price ever. Sugar prices have also gone up to Sh145 per kilo from Sh95. It’s tough and it has created discomfort,” said Mr Ndugire, a Nakuru businessman, in an interview with the Nation.
Indicating that his overall Christmas spending would almost double compared to last year, Mr Ndugire says he has had to cut down on merrymaking.
KNBS data shows the price of a kilo of sukumawiki, a staple vegetable in many low-income households, has increased to an average of Sh56.07 up from Sh50.77 last December while a 2kg packet of sugar now costs between Sh30 and Sh50 more this December compared to November last year, with the prices ranging up to Sh270 in some retail outlets.
The statistics agency’s data shows prices of goods and services have consistently increased over the past year, with the trend continuing this month.
This spells doom for many households in the country, with cooking gas, oil and sugar being among the most consumed products for the preparation of meals during festivities.
Mr Kelvin Mwangi, a small scale trader, also says he will cut on unnecessary spending and avoid travelling this Christmas to keep his expenditure within budget.
“Compared to previous years, I don’t think people are going to enjoy this Christmas as much owing to the rising cost of consumer goods,” he said in an interview.
“I will cut down on buying things that I don’t need or those that can be bought later when prices are low. I will also reduce travelling during this season owing to the hiked fares.” Mr Mwangi added.
KNBS reports that the price of a kilo of beef had risen 10.71 percent to Sh490.65 by last month, from Sh443.19 in November last year, as the recent drought that hit parts of the country hard affected the supply of meat to butcheries.
Rise in prices for basic goods
The cost of a 500-milliliter packet of cow milk has also increased 3.32 percent in the period from Sh48.57 to an average of Sh50.18 as per KNBS data, with most shops retailing the popular brands at Sh55.
A kilo of tomatoes has risen 15.14 percent to Sh98.89 up from Sh85.89.
The rise in prices for these basic commodities has contributed to an overall rise in the cost of living for Kenyans, following an increase in the cost of key products such as electricity, fuel, and Liquefied Petroleum Gas (LPG), which have a ripple effect on the cost of other goods.
The cost of 50 kilowatts (kWh) of electricity has risen 14.27 percent costing consumers Sh921.45 last month up from Sh806.37 last year, while the cost of a 13-kilogram LPG cylinder has also shot up 29.27 percent to Sh2,611.16 on the reintroduction of a 16 percent Value Added Tax (VAT) by the State in July.
The energy regulator last week announced a further increase in power prices this month after an upward review of the fuel component of the power bills, even as it announced on Saturday that it is waiting for a tariff review application from utility firm Kenya Power to implement the State directive to lower prices by 15 percent before year-end.
Unfulfilled promise
A promise by President Uhuru Kenyatta that Kenyan households would be paying at least 30 percent less for electricity by this Christmas compared to what they paid by September remained unfulfilled by yesterday, as they continued to pay even higher prices, with pre-paid power tokens selling at about Sh18.9 per unit.
Prices of petrol and diesel have also risen 22.33 percent and 21.67 percent respectively during the period, with a litre of petrol now costing about Sh130.54, up from Sh106.71 while diesel has jumped to Sh111.51.
As it stands, Kenyans continue to pay high prices for food and other basic consumables, as the economy struggles to rebound from the shocks inflicted by the Covid-19 pandemic.
Financial experts say during times like this, even though many always exhibit generosity in spending driven by the hype of the season, considerations should be more on one’s financial health, as well as commitments going into the new year.
“The most important rule is to first pay for or set aside money for very important needs such as rent, school fees, and food. Make sure you keep the budget for non-essentials such as travel reserved. Also, ensure you have reserved sufficient money for necessities in January, and if you have insurances to renew and other investments pay up,” says Mr Simon Gathecah.
