Controller of Budget Margaret Nyakang’o has revealed that at least 16 counties are engaging in “fraudulent budgeting” to hide actual expenditure on employee compensation.
The COB said counties are deliberately underreporting staff-related expenses by declaring misleading compensation for periods shorter than the full financial year.
Only eight counties complied with the law and did not exceed the legal threshold for wages. “Some counties are becoming clever by engaging in fraudulent budgeting.
They are deliberately not requisitioning salaries for a month or two so that, by the end of the year, they report spending for fewer months,” she said.
The unpaid salaries for one or two months are then reported in the subsequent financial year, creating the illusion of compliance with fiscal regulations.
Nyakang’o explained that this deceptive trend began in the last financial year, as counties sought to
appear compliant with the law that
caps spending on employee compensation at 35 per cent of total revenues.
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