REVEALED: SRC Exposes Counties Spending Up to 63% of Revenue on Salaries

The Salaries and Remuneration Commission (SRC) revealed that county governments spent Ksh171.36 billion on personnel costs in the first nine months of the 2025/26 financial year, an 11% increase from Ksh154.94 billion in the same period in FY2024/25.

According to the SRC’s Fourth Quarter Wage Bill Bulletin, covering April to June 2026, the increase in county personnel costs comes as most counties continue to spend more than the recommended share of their revenue on employee compensation.

“The expenditure on Personnel Emoluments (PE) in county governments for the first nine months rose by 11 per cent from Ksh 154.94 billion in FY 2024/2025 to Ksh 171.36 billon in FY 2025/2026,” read part of the Buttletin.

County Wage Costs Remain Above Legal Limit in Most Counties

The SRC said the average county wage-bill-to-revenue ratio remained above the 35% threshold set under the Public Finance Management Act, 2012 with only five counties recording ratios below the threshold.

Tana River recorded the lowest ratio at 27%, followed by Kwale and Nakuru at 30% each. Uasin Gishu recorded 31%, while Kirinyaga stood at 32%.

On the other hand, Taita Taveta and Homa Bay recorded the highest wage-bill-to-revenue ratios at 63%, followed by Machakos at 58%. This means personnel costs accounted for nearly two-thirds of revenue in Taita Taveta and Homa Bay during the period.

The Commission said the high ratios highlight the pressure county governments face in balancing employee costs with other spending priorities, including development and service delivery.

Despite the 11% increase in personnel costs, the share of county revenue spent on salaries fell from 46.8% to 44.12%.

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This means county revenue grew faster than spending on employees during the period, although the average ratio remained above the statutory threshold.

 Public Wage Bill Set to Reach Ksh1.287 Trillion

The SRC also reported that Kenya’s overall public service wage bill is provisionally expected to reach Ksh1.287 trillion in FY2025/26, up from Ksh1.247 trillion in FY2024/25.

The commission attributed the increase mainly to expansion in the teaching, health and security sectors, as well as periodic salary adjustments to reflect the cost of living.

However, it highlighted that the wage bill-to-ordinary-revenue ratio is projected to decline from 41.82% to 40.68% due to fiscal consolidation measures and improved ordinary revenue collection.

At the national level, spending on government employees remained below the 35% limit set under the Public Finance Management Act.

During the first nine months of the 2025/26 financial year, national government spending on employees rose from 27.6% to 28.1% of total revenue, while employee spending as a share of total government spending fell from 30.5% to 28%.

SRC Calls for Better Public Service Performance

Furthermore, SRC said that according to the 2026 Economic Survey, public-sector employment grew by 4.6 per cent in 2025, up from 3.1 per cent in 2024.

The Teachers Service Commission remained the largest public-sector employer, with the number of employees rising by 6.2% from 410,700 in 2024 to 436,300 in 2025.

Ministries and other government institutions had 243,500 employees, while county governments had about 239,000 employees.

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It said it is also working to improve productivity and performance in the public service. In June 2026, the Commission held its first National Productivity and Performance Conference, which produced seven resolutions aimed at improving productivity, public services, revenue collection and accountability.

Over the past year, the SRC also advised 42 institutions on negotiations between employers and workers over pay and working conditions.

The Commission said its work is focused on ensuring fair and sustainable pay while protecting taxpayers and managing the public wage bill responsibly.

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SRC CEO Ali Abdullahi Surraw during his vetting process. PHOTO/ Parliament FB