The Cabinet has endorsed a KSh 4.7 trillion budget for the next financial year and unveiled sweeping payroll reforms after a government audit exposed deep governance failures, cybersecurity gaps and unauthorised payments across the public service.
- •The spending plan projects revenues of KSh3.53 trillion against total expenditure of KSh4.7 trillion.
- •Recurrent expenditure is projected at KSh3.46 trillion, while development spending will total KSh749.5 billion, and transfers to county governments are set at KSh495.7 billion.
- •The Cabinet’s budget approval came alongside urgent measures to overhaul the Government Human Resource Information System–Kenya (HRIS-K) after a special audit uncovered extensive payroll anomalies.
Officials said the audit revealed that more than 4.7 million payroll records were altered by 720 system editors without audit trails, in some cases allowing employees to modify their own details. The review also flagged identity inconsistencies, tax compliance issues, unverified bank accounts and the failure of roughly 300 state corporations to migrate to the central payroll system.
Cabinet ordered immediate stabilisation measures, including mandatory cybersecurity certification by March 11, deployment of forensic analytics to identify irregularities and potential prosecutions, and the creation of Payroll Audit Units across government entities. Accounting officers will now be held personally accountable for payroll discrepancies, while statutory deductions must be effected at source across all public bodies.
Separately, Cabinet authorised KSh4.1 billion in additional drought relief as food insecurity worsens following failed short rains, with an estimated 3.3 million people currently affected. The government also approved $128 million in additional financing to complete the Mwache Multipurpose Dam in Kwale County, aimed at boosting water security for coastal regions.
A sweeping package of education reform bills was forwarded to Parliament, including proposals to consolidate tertiary education funding bodies into a single authority and to transition assessments toward competency-based models aligned with ongoing curriculum reforms.
Cabinet also endorsed an updated policy framework for devolution to address long-standing coordination and financing challenges between national and county governments, while approving measures to strengthen consumer protection laws and position Kenya as a regional hub for meetings and conferences.
Additional decisions included authorising international agreements to host major global institutions in Nairobi, approving Kenya’s hosting of the International Nuclear Conference in March, and backing the establishment of regional anti-money-laundering training capacity.
The Budget Policy Statement will now be submitted to Parliament, where lawmakers are expected to scrutinise the fiscal plan amid heightened public attention on payroll governance and government spending discipline.
