NAIROBI, Kenya – At least 16 county governments are under investigation for allegedly falsifying their wage expenditure reports to appear compliant with legal spending limits, Controller of Budget (CoB) Margaret Nyakang’o has revealed.
According to the 2023–2024 County Budget Implementation Review, some counties deliberately withheld salary payments for one or two months, creating the illusion that they were operating within the Public Finance Management (PFM) regulations that cap employee compensation at 35 per cent of total revenue.
“Some counties are becoming clever by engaging in fraudulent budgeting. They are deliberately not requisitioning salaries for a month or two so that, by the end of the year, they report spending for fewer months,” Dr Nyakang’o said.
The withheld salaries are later paid out in the following financial year, effectively masking runaway wage bills and presenting a false picture of fiscal discipline.
Counties Named in Report
The counties flagged include Bungoma, Narok, Turkana, Bomet, Kilifi, Kisumu, Machakos, Makueni, Mandera, Marsabit, Meru, Murang’a, Nyandarua, Tharaka Nithi, and Mombasa.
Bungoma and Narok failed to account for salaries in May and June, while the rest omitted June payments despite receiving full funding from the National Treasury.
“The Treasury and Central Bank even left the system open for several days after the close of the financial year, but they still failed to report,” Nyakang’o added. “They are trying to manage the ratios — it is what we call fraudulent budgeting.”
Figures from the CoB show that Bungoma spent Sh6.31 billion on wages over ten months, equivalent to 45 per cent of its revenue, while Narok reported Sh5.5 billion — keeping its wage ratio at 35 per cent by excluding the final two months. Turkana, even after skipping June, still breached the limit at 37 per cent.
If full-year data were disclosed, Nyakang’o warned, some counties could be spending up to 70 per cent of their revenue on salaries, leaving little for development projects or essential services.
Wage Bill Crisis Deepens
Across the 47 counties, employee costs accounted for 47 per cent of total expenditure (Sh470.23 billion) and 41 per cent of total revenue (Sh533.11 billion) — well above the legal ceiling.
Salaries and allowances alone consumed Sh220.64 billion, an increase of Sh10.8 billion from the previous year.
Counties with the highest wage-to-revenue ratios include Nyeri (55%), Machakos (54.5%), Baringo (53.4%), Tharaka Nithi (53%), and Taita Taveta (51%).
Others above the threshold are Nairobi, Elgeyo Marakwet, Homa Bay, Lamu, Murang’a, Kisumu, Bomet, Mombasa, Vihiga, Marsabit, Nyamira, and Busia.
Only eight counties — Kilifi, Siaya, Tana River, Nakuru, Kwale, Nandi, and Nyandarua — complied with the 35 per cent legal limit.
Nyakang’o warned that ballooning wage bills remain the greatest threat to county financial stability, with most devolved units now spending more on salaries than on development.
