Public servants could soon see an end to automatic performance bonuses with the Salaries and Remuneration Commission proposing a new framework for rewarding productivity.
The new framework, which SRC is currently seeking public views on, ties financial rewards to measurable productivity, performance and government revenue.
The revised Framework for Recognising Productivity and Performance in the Public Service introduces a Variable Productivity and Performance Reward Scheme under which officers must meet set performance thresholds to qualify for individual rewards.
The framework, issued in August, took effect on July 1, 2026 and applies to public service institutions in the national and county governments.
The new system could see top performers receive rewards running into millions of shillings, while officers who fall below the required performance threshold get no individual performance reward.
An SRC simulation shows the difference in the different categories within which public servants could get cash boosts for a job well done.
An officer earning a basic salary of Sh100,000 a month and scoring 112 per cent could receive Sh1.3 million under the simulated conditions.
The amount comprises a Sh1.2 million national productivity-based reward and Sh112,000 individual performance reward.
As per the simulations, another officer earning the same salary but scoring exactly 100 per cent would receive Sh1.2 million in the simulation.
The latter comprises Sh1.1 million from the national productivity component and Sh100,000 as the individual reward.
However, the framework makes clear that such payments are not automatic.
For the individual PPC-based reward, an officer scoring above 100 per cent is rated excellent and qualifies for a reward equivalent to the score multiplied by one month's basic salary.
An officer scoring exactly 100 per cent is rated very good and qualifies for one month's basic salary.
Those scoring between 80 and below 100 per cent are rated good, while those scoring between 60 and below 80 per cent are rated fair.
Fair and poor performers are not eligible for the individual PPC-based reward.
The framework provides another route through the national or county productivity-based component, and will be dependent on the performance of the institution as well as the individual productivity index.
A department or institution must achieve a productivity index of at least 2.3 and a composite performance score of at least 100 per cent to qualify for the national or county productivity-based reward.
This means an officer's overall reward will depend on a combination of individual performance and the productivity of the institution where he or she works.
REVENUE TEST
Even institutions and officers that meet the performance requirements will not automatically receive the reward.
The national or county productivity component will only be declared when ordinary revenue or own-source revenue exceeds approved targets.
It will also follow if GDP grows from the previous financial year and when productivity improvement targets are achieved.
The reward pool will be financed from additional ordinary revenue or own-source revenue collected above the approved target.
Public servants will be granted up to 30 per cent of the additional revenue collected as bonuses.
SRC warns lower or even zero rewards may be declared when revenue collection falls below target or during economic downturns.
This makes government revenue performance a key determinant of whether public servants receive the national or county component at all.
The rewards will be paid once at the end of the financial year and will not form part of pensionable earnings.
BAD AUDITS
The framework also links financial rewards to financial stewardship and governance.
A qualified audit opinion will not automatically disqualify an entire institution.
Instead, responsibility will be assigned to the governance organ, management, department or officers responsible for the audit findings.
However, institutions receiving an adverse or disclaimer audit opinion will be excluded from productivity and performance rewards.
The new approach also reaches into collective bargaining.
Public institutions negotiating CBAs will be required to incorporate productivity and performance considerations into remuneration arrangements.
The framework says officers' progression in remuneration will be based on measurable productivity and performance and achievement of thresholds set or advised by SRC.
Productivity-based rewards in CBAs will also be variable and conditional on measurable results rather than treated as automatic payments.
SRC says the reforms are intended to promote efficiency, accountability, innovation, better service delivery and a more sustainable public wage bill.
SRC chairperson Sammy Chepkwony earlier expressed regret the country had spent more than 10 years trying to rein in wage expenditure through legal caps, with limited success.
The Public Finance Management Act, 2012, limits salaries and wages to 35 per cent of total revenue.
However, the wage-bill-to-revenue ratio currently stands at 41 per cent, an improvement from 55 per cent recorded in 2020.
As of June 2025, the public wage bill was projected to approach Sh1.3 trillion, raising concerns about its sustainability amid mounting debt obligations and pressure on government revenue.
SRC argues the challenge is not simply how much the government pays its employees, but whether taxpayers receive value for the money spent on public workers.
SRC data shows Kenya ranked 142nd out of 182 countries globally in labour productivity in 2025, improving from position 155 out of 189 countries in 2023.
Within Africa, Kenya ranked 21st out of 52 countries, behind economies including Mauritius, South Africa, Botswana and Ghana.
INSTANT ANALYSIS
Public servants are entering a dispensation where bonuses will no longer be something to expect simply because a financial year has ended. Going forward, performance, institutional productivity, government revenue and financial accountability will determine who gets rewarded, and most definitely, who gets nothing.
