Senate Committee recommends probe over Sh732 million Wajir workers' deductions

A Senate watchdog committee has recommended criminal investigations and possible sanctions over unremitted statutory deductions and employees' benefit contributions amounting to Sh732.6 million in Wajir County.

The recommendation emerged during a heated sitting of the Senate County Public Accounts Committee (CPAC), chaired by Homa Bay Senator Moses Kajwang, where legislators faulted longstanding failures to remit workers' pension contributions and statutory deductions, some dating back more than a decade.

The outstanding liabilities relate to unremitted statutory deductions to the National Social Security Fund (NSSF), employees' contributions to the Local Authorities Pension Trust (LAPTRUST), and the Local Authorities Provident Fund (LAPFUND), with some arrears stretching back to the 2014/2015 financial year.

In her audit report for the financial year ended 30 June 2025, Auditor-General Nancy Gathungu reported that the county's unremitted obligations comprised Sh76 million in basic salaries for civil servants, Sh536 million in employer contributions to staff pension schemes, Sh7.7 million in employer contributions to NSSF, and Sh113 million in gratuity payments for civil servants.

The cumulative liabilities stood at approximately Sh733 million.

“This was contrary to Section 19(4) of the Employment Act, Cap 226, which states that an employer who deducts an amount from an employee's remuneration shall pay the amount so deducted in accordance with the time period and other requirements specified in the law, agreement, court order or arbitration, as the case may be,” Ms Gathungu said.

The findings prompted a strong response from senators, who said workers had suffered due to the failure to remit deductions to the relevant institutions.

Senator Kajwang said the matter went beyond an accounting lapse and pointed to deeper weaknesses in public financial management.

“You deduct somebody's money and fail to remit it. It is actually criminal. You are stealing from employees,” he said.

Current Wajir Governor Ahmed Abdullahi, who appeared before the committee, told senators that a significant portion of the liabilities arose during the previous county administration between 2018 and 2022.

He said the Sh732 million reflected principal amounts and did not include accumulated interest and penalties, which he said had pushed the total liabilities to more than double the original amount.

“All this relates to the period between 2018 and 2022. These are payables relating to 25 months of pensions and gratuities that were deducted but not remitted,” he told the committee.

Governor Abdullahi said his administration inherited legal disputes with pension schemes over the non-remitted deductions.

“They waited until just before the elections to go to court. By the time we came in, the matter was already in court,” he said.

He added that his administration had remained up to date with current statutory deductions and was negotiating out-of-court settlements with pension schemes to reduce accumulated penalties and interest.

The governor said the county had already cleared Sh109 million owed to the Kenya Revenue Authority and planned to settle Sh7.6 million in NSSF contributions.

“We are up to date with respect to current remittances. But when you add penalties and interest to these principal amounts, the figures become enormous and difficult for counties to absorb in one financial year,” he said.

However, senators said workers continued to bear the burden of the unresolved liabilities.

Nairobi Senator Edwin Sifuna criticised the delays in resolving the issue and said affected employees deserved urgent action.

“There are people who have retired and are waiting for gratuity. They have children in school and families depending on them, but we are still talking about ongoing discussions and negotiations,” he said.

He added that those ultimately found responsible should face legal consequences.

“Even criminal sanctions should follow such people. It is unconscionable to deduct money from employees and fail to remit it,” he said.

Nandi Senator Samson Cherargei called for investigations by anti-corruption agencies.

“If somebody took people's money, then they should be investigated and prosecuted. Criminal liability does not expire simply because someone left office,” he said.

Kitui Senator Enock Wambua said retired employees were more interested in practical solutions than administrative explanations.

“The people of Wajir who are at home suffering already know that money was not remitted. What they want to know is what exactly is being done to reduce their suffering,” he said.

Taita Taveta Senator Johnes Mwaruma said investigators should establish whether any public funds were improperly diverted and, if so, who was responsible.

Governor Abdullahi maintained that his administration inherited a difficult financial situation and pledged to conclude agreements with pension administrators and allocate more resources towards clearing the debts.

“We will sign agreements and pay something substantial. We cannot clear the whole amount immediately, but we will put more money in the coming budgets and bind future administrations to continue payment,” he said.

The Senate committee indicated it would recommend investigations and possible prosecution of those ultimately found culpable, while also pushing for mechanisms to ensure restitution for affected workers.

Senator Kajwang said compensation for affected workers should accompany any criminal accountability measures.

“It is not enough to jail someone who stole people's money while victims continue suffering. Restitution must also follow,” he said.

The committee further directed the Auditor-General to establish whether the county had fully addressed ongoing statutory remittance obligations in subsequent audit cycles.