41 counties breach wage limit despite SRC warnings
Only six counties, Nakuru, Kwale, Busia, Tana River, Narok, and Kilifi complied with the 35 per cent rule as set out in the PFM Act, 2012.
A new report by the Salaries and Remuneration Commission has exposed continued financial indiscipline by most counties, showing that 41 devolved units are still breaching the law on salary spending.
According to the commission’s Second Quarter Wage Bill Bulletin for the 2024/2025 financial year, counties spent Sh52.16 billion on salaries and allowances between October and December 2024, marking a steep rise from Sh38.69 billion in the first quarter.
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This 34.8 per cent increase pushed most counties above the legal ceiling on personnel emoluments.
The Public Finance Management Act restricts county governments from spending more than 35 per cent of their ordinary revenue on salaries. However, the report shows widespread disregard for this regulation.
“The growth in county personnel expenditure is concerning and unsustainable,” the SRC stated in the bulletin released on Tuesday.
Only six counties, Nakuru, Kwale, Busia, Tana River, Narok, and Kilifi complied with the 35 per cent rule as set out in the PFM Act, 2012. The rest exceeded the threshold, raising red flags over the sustainability of county wage bills and the impact on other budget areas.
Although the share of personnel emoluments to overall county expenditure fell from 69.5 per cent in the first quarter to 61.9 per cent in the second quarter, the spending remains well above the legal cap.
The ratio of salary expenses to ordinary revenue also declined slightly from 44.01 per cent to 41.13 per cent — still breaching the required limit.
“This continued breach of the legal spending threshold constrains counties’ ability to fund development and essential services,” the Commission warned.
The SRC is now urging counties to restructure their budgets and put firm spending controls in place. The commission emphasised that overspending on salaries crowds out funds meant for projects that directly benefit citizens.
Meanwhile, the national government has kept its personnel spending within the acceptable range.
Data from the Controller of Budget shows that although the national wage bill is expected to rise from Sh170.29 billion in the second quarter of the 2023/2024 financial year to Sh212.53 billion in the same period of the 2024/2025 year, the share of revenue spent on salaries is projected to drop from 31.7 per cent to 25.7 per cent — remaining within the legal threshold.
The SRC has reiterated the importance of maintaining prudent financial discipline at both levels of government. It stressed the need for sustainable wage bill management to protect service delivery and development spending.
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