The Salaries and Remuneration Commission (SRC) has reported a notable decrease in Kenya’s public wage bill over the past six years, marking a 4.9 percent reduction to 46.6 percent of total ordinary revenue in the 2022/2023 fiscal year.
The SRC forecasts this figure will further drop to 39.2 percent in the upcoming 2023/2024 fiscal year.
SRC Chairperson Lyn Mengich expressed confidence in the progress made, highlighting that the wage bill’s ratio to total revenue has decreased from 51.54 percent in the 2017/2018 fiscal year to 47.06 percent in the 2021/2022 fiscal year.
Mengich acknowledged that while the trend is positive, ongoing efforts are needed to sustain this progress.
Despite the percentage decrease, the absolute value of the public wage bill has risen significantly. From Sh785 billion in FY 2017/2018, the wage bill increased to Sh1.035 trillion in FY 2021/2022 and is projected to reach Sh1.17 trillion in FY 2023/2024.
This growth is largely attributed to the expansion of the workforce in key sectors such as education, health, and security, as well as adjustments in pay and benefits to cope with the rising cost of living and to attract essential skills.
The SRC has introduced several initiatives to manage the wage bill more effectively. These include streamlining allowances, harmonizing remuneration and benefits structures, reviewing and aligning pension benefits, and developing a central analytical tool to monitor payroll. This tool aims to improve accountability, prevent excessive and unauthorized payments, and ultimately reduce the wage bill.
Mengich also warned that high public wage bills pose a risk to sustainable public expenditure, potentially diverting resources from development priorities and essential social services. Recently, the SRC has intensified efforts to reduce Kenya’s wage bill by addressing role overlaps in government and state corporations.