Cabinet has directed the Directorate of Criminal Investigations (DCI) to investigate a multi-billion-shilling payroll fraud scheme after a government audit uncovered suspected irregularities amounting to Ksh6.2 billion across several State Departments.
Following a meeting chaired by President William Ruto on Tuesday, June 30, Cabinet said the reforms were intended to address long-standing weaknesses in the management of the public wage bill.
"President William Ruto today chaired a Cabinet meeting at State House, Nairobi, where Cabinet approved sweeping reforms to dismantle deeply entrenched and decades-long payroll fraud in Government, restore integrity to the public wage bill and safeguard taxpayers' money through a whole-of-government payroll clean-up," the Cabinet Dispatch read.
According to Cabinet, the decision was informed by findings from a comprehensive review of government payroll systems.
The audit revealed significant anomalies within a sample of State Departments, raising concerns over the integrity of payroll management processes.
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"The decision follows a comprehensive Government payroll audit that uncovered widespread weaknesses in payroll governance.
"A sample audit of 12 of the 53 State Departments revealed suspected payroll irregularities amounting to Ksh6.2 billion, exposing unauthorised alterations to payroll records, irregular payments, weak controls over statutory deductions, and fragmented payroll management and major oversight gaps," the dispatch added.
Following the findings, Cabinet ordered the DCI to take immediate action against those responsible and to pursue recovery of lost public funds.
"Consequently, Cabinet directed the Directorate of Criminal Investigations to investigate payroll fraud, verify personal numbers used in payroll processing, dismantle criminal networks manipulating Government payroll systems, recover lost public funds, and ensure the immediate arrest and prosecution of all persons found culpable," the dispatch further read.
Cabinet also approved a broad payroll reform programme that will be rolled out across government institutions to strengthen oversight and prevent future abuse.
"The meeting also ordered the immediate implementation of a comprehensive payroll reform programme, including a Government-wide audit of all remaining State Departments and public institutions, mandatory migration of all Ministries, Departments, Agencies and State Corporations onto the newly revamped Integrated Human Resource and Payroll System, enhanced cybersecurity, payroll data cleansing and validation, establishment of a disaster recovery site, and integration of payroll with other public financial management systems," the dispatch noted.
In addition, Cabinet announced a temporary freeze on the leasing or hiring of additional office space as part of efforts to cut costs.
"In another cost-saving measure, Cabinet froze the leasing or hiring of additional office space pending an audit of Government office space and utilisation while developing a comprehensive programme to renovate public offices and make them more efficient and fit for service delivery," the dispatch read.
At the same time, the government has approved a Ksh4.5 billion initiative aimed at expanding maternal and child healthcare services across the country through the construction of 10 new hospitals.
Cabinet gave the greenlight to the Mother-and-Child Lifeline Initiative, a partnership between the government and Amsons Group that will see the establishment of Level 4 and Level 5 Mother and Child hospitals in several counties.
Announcing the decision, Cabinet said the project will be implemented in Nairobi, Garissa, Embu, Kisumu, West Pokot, Uasin Gishu, Mombasa, Nakuru, Kwale and Bomet counties.
"Cabinet gave the greenlight to the Ksh4.5 billion Mother-and-Child Lifeline Initiative, a partnership with Amsons Group to build 10 Level 4 and Level 5 Mother and Child hospitals at Magadi Road (Nairobi), Galmagalla in Fafi (Garissa), Siakago (Embu), Kisumu County Referral Hospital, Kabichbich (West Pokot), Huruma (Vasin Gishu), Tudor (Mombasa), Bahati (Nakuru), Samburu (Kwale) and Chebunyo (Bomet)," the dispatch revealed.
The Cabinet dispatch further stated that the new initiative will complement another ongoing healthcare programme focused on improving maternal and neonatal services.
According to Cabinet, the project will work alongside the second phase of the Kenya-Austria Mother and Child - Our Future Project, which has been allocated Ksh7.8 billion.
"Alongside the Ksh7.8 billion second phase of the Kenya-Austria Mother and Child - Our Future Project, the Mother and Child Lifeline Initiative will modernise maternal and neonatal care at Kenyatta National Hospital," the dispatch further read.
