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Uhuru Orders External Audit over Sh1.8 Billion Loss to Ghost Workers

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President Uhuru Kenyatta

President Uhuru Kenyatta has ordered an external audit of the public service payroll after findings indicated a possible loss of Sh1.8 billion a year in irregular payments to ghost workers.

President Kenyatta said a partial audit carried out in eight ministries indicated that “a considerable number of officers who are either on secondment, are deceased, retired or have deserted their duties” were still being paid.

He said the audit revealed Sh70 million in irregular payments, which when extrapolated to all 18 ministries amounted to Sh150 million a month.

“In my view, this has contributed in the continued expansion of the wage bill, over and above the true and correct position,” President Kenyatta said in a statement to newsrooms on Thursday.

“It is with this in mind, and considering the significance of these preliminary findings, and the consternation that these revelations portend, that I am directing the Ministry of Devolution and Planning, in collaboration with the National Treasury to outsource this assignment, he added.

The President said a final report of the external audit is expected to contribute to the rationalisation of the public service.

Full Statement:

My government is committed to ensure that public service is managed effectively and efficiently. Part of our strategy is to ensure that not only does the public service deliver on its mandate, but that we as a government also eradicate wastage and loss of public resources thereby releasing more funds to development and service delivery.

To this end, I instructed the Ministry of Devolution and Planning, being the ministry responsible for the Directorate of Public Service Management, to carry out a human resource audit in the public service. This exercise, has since begun and has included cleansing the payroll and identifying malpractices in payroll management in national government ministries. The earliest findings of this exercise has caused me to be very concerned. In an initial eight (8) ministries partially audited, we have found evidence that indicates that a considerable number of officers who are either on secondment, are deceased, retired or have deserted their duties and who therefore ought not to be remunerated, are still retained in the public service payroll.

In my view, this has contributed in the continued expansion of the wagebill, over and above the true and correct position. For example, interim results from the eight ministries reveals that an estimated Kshs. 70 million could be deemed irregular payments to officers who have since left 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 Kshs. 150 million monthly, and approximately Kshs. 1.8 billion annually. Though it is important to note that the process is still ongoing, and that verification of specific payments is being undertaken, initial reports suggest that considerable savings could be made on recurrent expenditures upon the correction of these erroneous payments on the system.

It is with this in mind, and considering the significance of these preliminary findings, and the consternation that these revelations portend, that I am directing the Ministry of Devolution and Planning, in collaboration with the National Treasury to out source this assignment, and, contract a reputable external firm to undertake a comprehensive human resource audit and payroll cleansing exercise. The comprehensive audit should be undertaken within 3 months, and a report of the findings submitted to this office soon thereafter. The final report of this review is expected to significantly contribute to the rationalization programme of the public service currently being undertaken through the coordination of the Ministry of Devolution and Planning.

Uhuru Kenyatta, CGH
President and Commander in Chief
of the Kenya Defence Forces

23rd January 2014

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