Controller of Budget Margaret Nyakang’o.
Forty counties paid at least Sh1.52 billion as salaries to some of their staff through manual payroll in just three months, circumventing the approved system, a new report has revealed.
The damning report by the Controller of Budget (COB), Margaret Nyakang’o, painted a grim picture of how devolved units deliberately fail to onboard their staff onto the Human Resource Information System (HRIS), creating an avenue for manual payment of salaries.
The county governments budget implementation review report for the first quarter of the financial year ending June 30, 2026, listed Nairobi, Nyeri, Siaya, Elgeyo Marakwet and Nakuru counties as the biggest culprits during the period under review.
According to the report, thousands of county employees are still outside the system, a move that exposes the county governments to loss of funds through possible payment of ghost workers.
Further, payment of salaries for thousands of casual staff and top-up allowances for security personnel fuel the practice.
“Manual payroll is prone to abuse and may result in the loss of public funds,” Dr Nyakang’o said in the latest report.
On the flipside, six counties — Baringo, Migori, Nyamira, Trans Nzoia, Uasin Gishu and West Pokot — were the only devolved units to strictly pay all personnel emoluments through the HRIS.
Wajir County did not report any expenditure on compensation to employees during the period reviewed, citing a delay in approval of the budget estimates for the current financial year and the subsequent Appropriation Act 2025. This is despite the CoB approving the withdrawal of Sh44.48 million from the county revenue fund account exclusively for employee compensation.
Over the years, the CoB has flagged a number of counties for processing billions of shillings in salaries manually, with such payroll systems linked to bloated wage bills and ghost workers.
In the first quarter of the financial year ended June 30, 2024, counties paid salaries to their staff through the manual system amounting to over Sh3 billion.
In the fiscal year ended June 30, 2022, the amount paid outside the approved payroll systems hit a staggering Sh15 billion.
Auditor-General Nancy Gathungu during a past event.
Reports by the auditor-general have also been damning on the use of manual payroll by counties with Nancy Gathungu revealing how circumventing approved payment systems by county governments is part of an elaborate payroll fraud that has led to loss of billions of shillings in taxpayers’ money over the years.
The law does not approve the use of manual payrolls, which is associated with ballooning wage bills in devolved units.
But counties often cite a lack of personal numbers for staff as the primary reason for not using the approved system.
Governor Mutahi Kahiga’s Nyeri County processed some Sh109.65 million through manual payroll, comprising salaries for 152 staff not on-boarded into the HRIS, salaries for 57 casuals, top-up allowances for security personnel, gratuity remittances to pension schemes for employees on contract, and Lapfund/Laptrust pension contributions.
Nyeri Governor Mutahi Kahiga.
At City Hall, Sh109.61 million was processed through manual payroll, comprising salaries for ward staff not on-boarded into the electronic system at Sh23.7 million/ Others were salaries for City Funeral Home, Langata Cemetery, mobility casual staff, and community health workers, accounting for Sh85.89 million.
Governor James Orengo’s Siaya County processed Sh105 million through manual payroll, including salaries for 1,021 staff not on-boarded into the HRIS, amounting to Sh54.7 million.
Siaya County Governor James Orengo.
The county paid another Sh55.2 million manually to 8,990 casual staff, while Sh1 million went to top-up allowances for 11 security personnel. Other payments were gratuity remittances to pension schemes for staff on contract and Laptrust/Lapfund contributions.
Nakuru Governor Susan Kihika.
Governor Susan Kihika’s Nakuru has 756 casual staff who were paid Sh56.5 million outside the HRIS out of the total Sh97.63 million processed through manual payroll.
Elgeyo-Marakwet processed 13 per cent of its total compensation to employees, a total of Sh92.75 million, manually.
This is because the administration of Governor Wisley Rotich is yet to on-board 917 staff to the HRIS whose salaries amounting to Sh89.2 million is processed manually. The remaining Sh3.5 million is gratuity for contract staff.
In Laikipia, Governor Joshua Irungu has 1,180 staff not onboarded into the HRIS paid Sh20.48 million manually.
Governor Abdulswamad Nassir’s Mombasa processed Sh77.15 million through manual payroll, with salaries for staff paid outside HRIS amounting to Sh57 million for both the county executive and assembly.
In Lamu County, at least Sh70.85 million was processed through the manual payroll as it grappled with 560 casual staff and 98 employees not onboarded into the HRIS.
Governor Paul Otuoma’s Busia County paid Sh59.25 million manually as it is yet to on-board 60 staff into the electronic system, has 991 casuals paid Sh23.5 million during the period under review, and had to pay Sh10.9 million as stipend for 2,190 community health promoters.
Turkana County spent Sh53.73million outside the approved system, while Garissa County had Sh57.36 million processed through manual payroll, comprising salaries for 195 staff not on-boarded into the HRIS, salaries for 508 casual staff, and top-up allowances for security personnel.
Kiambu County, led by Governor Kimani Wamatangi, is struggling with 4,220 casuals not on-boarded into the electronic system and are paid manually as part of the Sh56.52 million processed through the manual payroll. The county also has 346 security personnel.
In Kericho County, Sh45.02 million was processed through manual payroll, with Sh45 million as salaries for 135 employees not on-boarded into HRIS and 89 casual staff.
Kilifi County processed Sh32.76 million through manual payroll, while Kirinyaga paid Sh32.98 million as it grappled with an average of 600 casual staff and 853 community health promoters, gratuity remittances to pension schemes for employees on contract, and contracted guards budgeted under compensation of temporary employee.
On its part, Mandera County processed Sh50.49 million through manual payroll, Kitui County Sh41.15 million, Nandi County Sh40.13 million and Meru County Sh35.34 million.
Machakos Governor Wavinya Ndeti.
Governor Wavinya Ndeti’s Machakos spent Sh31 million outside the system, Murang’a County Sh28.61 million and Taita Taveta Sh26.74 million. Kakamega County paid Sh26.92 million towards 28 employees not on-boarded into HRIS, two board members and 15 casual staff.
Nyandarua County processed Sh25.33 million through manual payroll, Bomet Sh18.92 million to pay salaries for some seven staff not on-boarded into the HRIS, 114 casual staff, and top-up allowances for security personnel, while Governor Joseph ole Lenku’s Kajiado processed Sh13.5 million manually.
In Homa Bay County, it was the assembly that spent Sh14.24 million through manual payroll to pay salaries for staff yet to be on-boarded into the system, Embu paid Sh12.38 million, while Samburu Sh12.09 million.
On the other hand, Tana River processed Sh11.50 million through manual payroll, Vihiga Sh11.30 million, Kisii Sh10.61 million and Makueni Sh8.39 million towards payment of salaries for 73 casual staff.
Governor Abdi Guyo paid out Sh6.84 million through a manual payroll system, Tharaka Nithi Sh5.46 million and Kisumu Sh5.96 million.
Governor Ken Lusaka’s Bungoma County processed Sh4.30 million through manual payroll, comprising salaries for 135 staff not on-boarded into the HRIS, salaries for 15 casual staff, salaries for three speaker’s partisan staff, and salaries for one board member and sitting allowances.
For Governor Fatuma Achani, Sh4 million was processed through manual payroll as salaries for 90 staff not on-boarded into the system, gratuity remittance to pension schemes for staff on contract, and Laptrust/Lapfund pension contributions.
Narok (Sh104,179) and Marsabit (Sh241,000) processed less than Sh500,000 through a manual payroll system.
Five counties with high manual payroll spending
Nyeri: Sh109.65 million
Nairobi: Sh109.61 million
Siaya: Sh105 million
Elgeyo Marakwet: Sh97.63 million
Nakuru: Sh92.75 million
Compliant counties
Migori
Baringo
West Pokot
Uasin Gishu
Trans Nzoia
Nyamira
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