The Salaries and Remuneration Commission (SRC) has released its First Quarter Wage Bill Bulletin for the 2024/2025 financial year, revealing significant cost savings and a slowdown in wage-related expenditure across public institutions.
Between July and September 2024, SRC received 88 requests from various public institutions, collectively valued at Ksh 10.35 billion.
Out of this, the Commission approved Ksh 6.45 billion—just over 62% of the total requested amount. This prudent decision-making resulted in a saving of Ksh 3.8 billion for the exchequer.
This marks a notable decline compared to the Ksh 39.80 billion in requests submitted during the same quarter of the 2023/2024 financial year.
“This reflects improved adherence to fiscal guidelines and demonstrates SRC’s commitment to sustainable wage management,” the Commission noted in the bulletin.
Of the 88 requests:
– 70% (62) were for allowances and benefits,
– 15% (13) for Collective Bargaining Agreement (CBA) reviews,
– 10% (9) for job evaluations and salary reviews, and
– 5% (4) for bonus requests.
County and National Government Trends
County governments spent Ksh 40.47 billion on Personnel Emoluments (PE), a slight dip from Ksh 41.79 billion in Q1 of FY 2023/2024. However, the expenditure still stood above the 35% threshold set by the Public Finance Management (PFM) Regulations, 2015—clocking in at 40.64% of total county revenue.
At the national level, PE spending dropped significantly to Ksh 111.09 billion from Ksh 120.99 billion in the same quarter of the previous year. This represents a decline in PE as a share of total expenditure (excluding national security and Consolidated Fund Services) from 23.53% to 19.72%.
Wage Bill Sustainability
The SRC also provided updates on broader economic indicators, indicating that the wage bill to nominal GDP ratio is projected to decline to 6.92% in FY 2023/2024 from 7.29% in FY 2022/2023.
It also indicated that the wage bill to ordinary revenue ratio is estimated to decrease from 54.77% in FY 2020/2021 to 46.23% in FY 2023/2024.
SRC has also noted that total wage payments are expected to rise moderately by 6.37% to Ksh 1.17 trillion in FY 2023/2024.
Public Sector Employment
The Teachers Service Commission (TSC) remained the top employer in the public sector, with an 8.72% growth in its workforce in 2023. County governments recorded a 1.89% increase, totalling 221,400 employees.
Meanwhile, parastatals and state corporations showed modest growth of just over 1%, and ministries and other government agencies expanded their workforce by 3.36%.
