Audit uncovers State agencies overspending on salaries despite staff shortages
Combined, the three agencies spent over Sh2.4 billion illegally on staff compensation, amid a government-wide wage bill increase that led to a freeze on new hiring across State departments.
An audit has revealed that three government agencies overspent on staff wages even as they struggled with staff shortages, highlighting inefficiencies in managing public-sector payrolls.
The Kenya Forest Service (KFS), Tourism Regulatory Authority (TRA), and National Biosafety Authority (NBA) all exceeded the legal limit on employee compensation in the year ending June 2024, despite operating with fewer staff than authorised under government staffing plans.
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Auditor-General Nancy Gathungu’s reports note that the agencies breached the 35 per cent revenue cap on staff spending, a ceiling established to ensure financial prudence.
“This was contrary to Regulation 26 (1) (a) (b) of the Public Finance Management Regulations, 2015, which stipulates National Government Entities' compensation of employees should not exceed a maximum of 35 per cent of revenue,” Gathungu stated.
While other State agencies were also cited for surpassing their wage bill limits, the combination of overspending and understaffing in these three agencies is particularly striking.
Staffing levels in State institutions are determined by the National Treasury, while pay rates are set by the Salaries and Remuneration Commission, meaning the overspending points to possible irregular allowances, inflated salaries, or overpayment of senior staff.
The Kenya Forest Service, operating with 20 per cent fewer staff than allocated, spent Sh5.7 billion on payroll, consuming 61 per cent of its Sh9.3 billion revenue, an overshoot of roughly 75 per cent.
The Tourism Regulatory Authority, with 38 per cent fewer employees, paid Sh208 million in wages, 44 per cent of its revenue, exceeding its payroll by Sh42 million.
Meanwhile, the National Biosafety Authority, despite working with 28 per cent fewer staff, spent Sh98 million on salaries, breaching the legal cap by Sh20 million.
Combined, the three agencies spent over Sh2.4 billion illegally on staff compensation, amid a government-wide wage bill increase that led to a freeze on new hiring across State departments.
The audit highlights a paradox in public management: agencies struggling with staff shortages yet mismanaging payroll funds, raising urgent questions about accountability and the enforcement of financial discipline.
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