President William Ruto chairs a Cabinet meeting at State House, Nairobi, on June 30. 2026.
The Cabinet has directed the Directorate of Criminal Investigations (DCI) to uncover payroll fraud that has occurred over the years.
This follows a government payroll audit which revealed widespread irregularities across state departments.
A sample audit of 12 of the 53 state departments revealed suspected irregularities amounting to 6.2 billion Kenyan shillings, including unauthorised alterations to payroll records, irregular salary payments and weak controls over statutory deductions, as well as fragmented payroll management systems.
In light of these findings, a Cabinet meeting chaired by President William Ruto on Tuesday instructed the DCI to take action.
"Cabinet directed the Directorate of Criminal Investigations to investigate payroll fraud, verify personal numbers used in payroll processing, dismantle criminal networks manipulating Government payroll systems, recover lost public funds, and ensure the immediate arrest and prosecution of all persons found culpable," the Cabinet dispatch read.
The Cabinet also approved far-reaching reforms aimed at cleaning up the public payroll and restoring integrity to the management of the government's wage bill.
These measures include a government-wide audit of all remaining state departments and public institutions and the mandatory migration of all ministries, departments, agencies, and state corporations to the revamped Integrated Human Resource and Payroll System.
The Cabinet also directed the enhancement of cybersecurity measures, the cleansing and validation of payroll data, the establishment of a disaster recovery site, and the integration of payroll systems with other public financial management platforms.
Cabinet has directed the Directorate of Criminal Investigations to uncover payroll fraud that has occurred over the years.
The directives were not limited to a payroll crackdown; other decisions reached during the Cabinet meeting included freezing the leasing or hiring of additional government office space, pending an audit of office utilisation, as part of efforts to cut public expenditure.
The Cabinet also established a Standing Cabinet Committee on Artificial Intelligence to coordinate Kenya's national AI strategy and approved the National Business Process Outsourcing Policy. This policy aims to establish the country as a leading global outsourcing destination and create thousands of digital jobs for young people.
"The committee will advance AI-driven innovation, productivity, public service delivery, job creation and inclusive economic growth while putting in place appropriate governance and safeguards," it read.
Other measures included the establishment of an Ad Hoc Cabinet Committee on El Niño Preparedness chaired by Deputy President Kithure Kindiki, additional financing for major infrastructure projects, new healthcare investments, measures to strengthen protection against gender-based violence, and policies aimed at revitalising the leather, cotton and textile sectors.
The Cabinet also approved several multi-billion-shilling infrastructure projects, including Sh26 billion for the second phase of the Judicial Performance Improvement Project to expand court infrastructure, an additional Sh16.6 billion to complete the Mwache Multipurpose Dam in Kwale County, and more funding for the Modogashe-Samatar and Rhamu-Mandera road sections under the 750-kilometre Isiolo-Mandera corridor.
In the energy sector, Cabinet endorsed petroleum cooperation agreements with Rwanda and South Sudan that will allow the two countries to import refined petroleum products through Kenya, boosting business at the Port of Mombasa, the Kenya Pipeline Company network and the Northern Corridor.
The Cabinet has also sanctioned the Kenya-United States Health Cooperation Framework to sustain collaboration in the fight against HIV, tuberculosis, malaria, and emerging diseases.
It also gave the green light to a Sh4.5 billion Mother-and-Child Lifeline Initiative that will see the construction of 10 Level Four and Level Five hospitals across the country, alongside investments to modernise maternal and neonatal care at Kenyatta National Hospital.
Equally, it adopted the Kenya Children Policy, 2025, approved the Protection Against Domestic Violence (Amendment) Bill, 2026, and endorsed the report of the Presidential Technical Working Group on Gender-Based Violence and Femicide to strengthen protection for women, children and vulnerable families.
To boost manufacturing, the meeting approved the Sh5.8 billion Leather Value Chain Development Support Project and adopted the National Cotton, Textile and Apparels Policy to revive cotton farming, expand textile manufacturing and create thousands of jobs. It also established the Kenya Leather Development Authority and approved a revised Micro, Small and Medium Enterprises (MSME) Policy to improve access to markets and financing for small businesses.
The cabinet has also approved Kenya's hosting of the Secretariat of the Alliance of African Multilateral Financial Institutions, authorised negotiations on a long-term Economic Partnership for Shared Development with China, and endorsed the ratification of several international agreements covering migrant workers, wildlife conservation and the Samoa Partnership Agreement.
Follow our WhatsApp channel for breaking news updates and more stories like this.
