Kenyan county governments have made at least Sh8.3 billion in manual salary payments outside approved digital payroll systems, according to a report by the Controller of Budget, Margaret Nyakang’o. The findings highlight a significant loophole in financial management, as counties resorted to manual processes—including voucher-based payments—to compensate casual staff and provide top-up allowances to security personnel. These methods, which bypass digital systems designed to prevent fraud, have raised concerns about potential abuse, including the risk of paying ghost workers.
The report underscores that manual payrolls were primarily used to settle salaries for temporary workers and additional allowances for security personnel. While digital payroll systems were implemented years ago to enhance transparency and curb financial mismanagement, some counties continued to rely on manual processes. This practice, which the Controller of Budget has flagged as problematic, increases the vulnerability to fraud, as voucher-based payments lack the oversight of automated systems. The report does not specify which counties engaged in these practices but emphasizes the systemic risks associated with circumventing digital protocols.
Margaret Nyakang’o, the Controller of Budget, stated that the use of vouchers to pay staff is particularly susceptible to misuse, including the potential for ghost worker payments. The report, which was released as part of ongoing efforts to strengthen fiscal accountability, calls for stricter adherence to digital payroll mechanisms. While the exact number of counties involved remains undisclosed, the scale of the manual payments—exceeding Sh8.3 billion—signals a widespread challenge in enforcing financial oversight at the county level.
Separately, Nairobi County faces a cash crunch that has stalled Sh2.24 billion in infrastructure projects. The county cited funding constraints, delayed payments for certified work, and contractual disputes as key factors. This financial strain, while distinct from the payroll issues, underscores broader challenges in managing public funds across Kenya’s devolved governance structure.