Devolution undermined as counties prioritise salaries over development projects - Report

A staggering Sh38.69 billion was spent on salaries and allowances by county governments in just three months, according to a report by the Controller of Budget (CoB).

This figure represents a significant portion (70 per cent) of the Sh55.68 billion available to counties between July and September 2023, leaving minimal funds for critical development projects.

The County Governments’ Budget Implementation Review for the first quarter of the financial year highlights a glaring disparity between recurrent and development expenditures.

While counties allocated Sh48.96 billion to recurrent expenditure, only Sh6.71 billion was spent on development programs. This means personnel costs were more than five times higher than the funds directed toward improving infrastructure, healthcare, and other essential services.

"Some counties are spending as high as 70% of their budget on salaries and allowances, effectively starving the people of development funds," CoB Margaret Nyakang'o lamented.

Ten counties, including Nairobi, Kisii, and Uasin Gishu, did not report any development expenditure during the period under review.

This concerning statistic revealed the growing tendency of devolved units to prioritise salaries over transformative projects, a practice that undermines the spirit of devolution.

Dr Nyakang’o revealed that the trend of escalating wage bills has been persistent, with staff compensation constituting 45.5% of counties’ total expenditure during the financial year ending June 2023.

In some counties, the figures were alarmingly higher, such as Kisii County, which spent 70 per cent of its budget on personnel emoluments.

Since the inception of devolution, the number of county employees has grown sharply. Data from the Commission on Revenue Allocation (CRA) shows the workforce ballooned from 94,700 in 2013 to 217,300 in 2022, an increase of 122,600 in a decade. By the end of 2023, the workforce had reached 184,876, with Nairobi County leading with 13,513 employees.

This growth in staffing has come at a cost. Counties have collectively received Sh3.62 trillion over the past decade, with salaries accounting for nearly 42 per cent, or Sh1.21 trillion. Alarmingly, some counties exceed the legally prescribed limit of spending 35 per cent of revenue on wages.

The Auditor-General and CoB have consistently warned counties about their unsustainable wage bills. Yet, the expenditure continues to rise, with counties like Kiambu (64.6 per cent) and Garissa (61.4 per cent) following Kisii in high personnel spending.