Kenya orders audit to stamp out public payroll fraud

Reuters News
Posted: Jan 23, 2014 11:10 AM

NAIROBI (Reuters) - Kenya's president on Thursday ordered an audit of the public sector payroll to end the practice of corrupt officials claiming salaries on behalf of "ghost employees" - workers who have died, retired or deserted their duties.

Uhuru Kenyatta announced after his election in March that he would make reducing Kenya's ballooning public sector wage bill a priority, saying it was "unsustainable" and weighing on the national budget.

In a statement from the presidency, Kenyatta said that a preliminary audit of some government ministries showed an estimated 70 million shillings ($816,300) were paid out a month to officers no longer employed in the service.

"If this were to be extrapolated to all 18 national government ministries, assuming the same trend holds, we are likely to save about 150 million shillings monthly, and approximately 1.8 billion shillings annually," he said.

The president also said an external firm would be appointed to audit the government's human resources services and clean up the payroll over the next three months.

In a speech last April, Kenyatta said that at around 458 billion shillings, public sector wages made up 12 percent of Kenya's gross domestic product, compared to a "globally recommended average of seven percent of GDP".

Kenya's economy expanded at a below-target 5.1 percent in 2013 but growth is expected to accelerate to 5.8 percent this year, the Treasury said last week.

Kenya's legislators are among the best paid in Africa. A move in June granting them extra allowances angered many in a country where the official unemployment rate stands at 40 percent.

After that, Kenyatta's government introduced other austerity measures including travel restrictions for government officials, although critics say these have largely been ignored.

($1 = 85.7500 Kenyan shillings)

(Reporting by James Macharia; Editing by Duncan Miriri and Raissa Kasolowsky)