Salaries agency races to help counties meet 35% wage bill ceiling

Salaries and Remuneration Commission chairperson Sammy Chepkwony during a meeting with Governor Irungu Kang'ata on March 10, 2026/ ALICE WAITHERA

The Salaries and Remuneration Commission will continue working with county governments to ensure they comply with the legal requirement that limits public sector wage bills to below 35 per cent of total revenue.

SRC chairperson Sammy Chepkwony said only six counties have met the threshold, while the rest are still working towards compliance.

He said although progress has been made in reducing the wage bill nationally, significant efforts are still needed for national and county governments to meet the target.

Chepkwony said Kenya’s wage bill stood at about 55 per cent of government revenue in 2020 but has gradually declined to about 40 per cent in recent years.

He attributed the improvement to measures aimed at slowing the growth of public sector salaries and promoting productivity among government employees.

“We have been slowing down the growth of the wage bill by ensuring salary increases are not too high and by focusing on productivity,” Chepkwony said.

The chairperson said SRC is now focusing on programmes that link pay to performance to improve efficiency in the public service.

He said Kenya’s public sector productivity levels remain relatively low compared to other countries and called for a national conversation on improving efficiency within government institutions.

Chepkwony said the commission is planning a national conference to raise awareness about productivity and share best practices from countries such as Singapore, which are known for highly efficient public service systems.

His remarks come as county governments face increasing pressure to comply with a court order requiring them to reduce their wage bills to sustainable levels.

In January this year, the High Court allowed the national government and county governments a transition period ending July 1, 2030, to progressively comply with the 35 per cent wage bill ceiling.

The ruling, issued by Justice Edward Mugambi, acknowledged that many government institutions currently exceed the limit and therefore require time to adjust their spending.

The court directed SRC to file annual affidavits every June 30 from 2026 to 2030 explaining how it is working with government institutions to reduce the wage bill ratio and regulate allowances and benefits.

The 35 per cent ceiling is anchored in public finance management principles aimed at ensuring governments do not spend a disproportionate share of their revenue on salaries at the expense of development and service delivery.

County governments across the country have struggled with high personnel costs, which in some cases consume nearly half of their annual budgets.

Murang’a Governor Irungu Kang'ata said his county is among those grappling with a high wage bill, currently standing at about 51 per cent of its total budget.

He said reducing the wage bill to the recommended 35 per cent level remains a major challenge, particularly because the county government is reluctant to lay off employees.

“Some people have advised that we reduce staff numbers but we consider that inhuman because these are people who depend on these jobs,” Kang’ata said.

Instead, the governor said the county is focusing on increasing its own-source revenue without introducing new taxes while also freezing new employment except in critical sectors such as health.

He said the county has opened several new dispensaries, which require additional medical staff, making it difficult to fully halt recruitment.

Despite the challenges, Kang’ata said Murang’a has improved its financial management in recent years, including ensuring county employees are paid on time.

He said before the current administration took office, workers sometimes experienced salary delays of up to three months.

County governments are now expected to gradually align their wage structures with the legal ceiling as they work towards full compliance before the 2030 deadline set by the court.