City Hall on a hiring spree despite ballooning wage bill

City Hall has been on a hiring spree in the last three years with more than 1,800 employees added to its workforce, pushing the county government further into the recurrent expenditure red line.

Governor Johnson Sakaja on Tuesday revealed that he now has 13,422 staff, up from 11,603 in 2019, pointing to a ballooning wage bill.

A November 2019 biometric report placed the number of employees at City Hall at 11,603, with 5,709 of them aged 50 years and above and only 792 of them being below 35.

Nairobi Metropolitan Services has also been in existence since March 2020 until after the elections.

Some 6,852 City Hall staff were seconded to NMS. It is not clear how many workers the defunct national government agency handed over to Governor Sakaja at the lapse of its tenure.

“I have 13,422 staff. On August 29, 2022, four days after I was sworn in as the governor, I met all of them at the City Hall square,” said Mr Sakaja.

City Hall has been spending more than Sh12 billion annually on personnel emoluments which is well over the 35 per cent ceiling required under the Public Finance Management (PFM) Act.

This is amidst dismal revenue collection with the county government averaging Sh10 billion annually in its own source revenue.

Employee costs include salaries, allowances, medical expenses and contributions to the National Social Security Fund (NSSF) and pension.

In the financial year that ended in June 2018, the county government spent Sh12.89 billion. In the financial year ending June 2020, City Hall spent Sh13.24 billion, then Sh13.09 billion in the next financial year.

First nine months

For the 2022 financial year, City Hall spent Sh10.9 billion in personnel emoluments in the first nine months.

The county government has been banking on voluntary early retirement, a scheme which has not taken off properly, to help reduce its bloated wage bill.

Former Finance and Economic Planning CEC Allan Igambi said high wage costs continue to undermine the county’s fiscal responsibilities, fearing that the cost could increase further to Sh18.1 billion in the financial year ending on June 30, 2023.

“The Nairobi City County wage bill is currently above the recommended expenditure, at 46 percent, in contravention of the Public Finance Management Act, 2012,” said Mr Igambi.

In the financial year ending June 2021, City Hall increased allocation for staff salaries and perks by Sh747.4 million amid a recruitment drive to replace its ageing workforce.

Through the supplementary budget, the additional funds were to foot employee costs in the county executive office excluding those in the four departments that were transferred to the NMS.

An exit report by Commission on Revenue Allocation released early in the month noted that devolved units have failed to reduce their wage bill to the maximum 35 per cent of the budget and also failed to increase their development expenditure to at least 30 per cent.

This, the report stated, has largely been due to county leaders inheriting excess staff members from their predecessors and going on their own hiring sprees.

This has also been due to poor collection of own source revenue where only Sh306 billion has been realised since the beginning of devolution in 2013.

However, Governor Sakaja has said he is planning to collect Sh100 million in own source revenue daily starting January 2023.

If this is realised, this will see City Hall collect more than Sh30 billion annually, more than triple the current average collection.

 The best the county government has collected was during former Governor Dr Evans Kidero’s tenure where Sh15 billion was realised.

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