PSC Cracks Down on Payroll Fraud, Warns HR Officers Over Illegal Salary Payments Outside Government System

PSC Cracks Down on Payroll Fraud, Warns HR Officers Over Illegal Salary Payments Outside Government System

NAIROBI, Kenya – The Public Service Commission (PSC) has issued a stern directive to all government ministries, departments and agencies (MDAs), ordering that salaries for civil servants be processed exclusively through the official government payroll system following the discovery of widespread payroll irregularities worth billions of shillings.

The warning was delivered by PSC Chairperson Francis Meja during a training workshop for Directors of Human Resource Management held at Lake Naivasha Resort in Nakuru County on Thursday, August 6, where he challenged HR professionals to strengthen accountability and eliminate fraudulent salary payments within the public service.

The directive comes barely a month after a government forensic audit uncovered payroll fraud estimated at Ksh6.2 billion across national and county governments, exposing major weaknesses in payroll management and oversight.

According to the audit, investigators identified thousands of suspicious payroll records, including ghost workers, officers receiving multiple salaries and individuals whose employment records contained impossible dates, including employees allegedly hired before they were born.

PSC Orders Salaries to Be Paid Only Through Official Payroll

Addressing human resource directors from across government institutions, Meja instructed officers responsible for payroll administration to ensure no public servant receives a salary outside the government’s Integrated Payroll and Personnel Database system.

He warned that payroll officers must verify every payment before approving salary schedules, stressing that negligence would no longer be tolerated.

“You are called upon to be diligent in your job and ensure that you don’t just sign off the payroll without ascertaining the accuracy and probity of the information.” Meja told HR directors.

The PSC chairperson emphasized that human resource officers occupy a critical position in safeguarding public resources and ensuring taxpayer money is used responsibly.

He cautioned that approving inaccurate payrolls without proper verification exposes the government to massive financial losses while undermining confidence in public institutions.

HR Managers Face Personal Accountability

Meja further warned that directors of human resource management would be held personally responsible if fraudulent salary payments continue under their watch.

He said HR officers must actively monitor payroll records, verify employment data and promptly report any irregularities instead of merely processing payroll documents mechanically.

According to the PSC, strengthening internal oversight remains one of the government’s key strategies in combating corruption and financial leakages within the public service.

The Commission believes tighter payroll controls will help eliminate ghost workers, duplicate salary payments and other fraudulent practices that continue to drain public finances.

Audit Exposed Massive Payroll Irregularities

The latest directive follows the release of a comprehensive forensic audit that revealed extensive payroll anomalies affecting both national and county governments.

Among the irregularities identified were employees receiving double salaries, fictitious workers who existed only on payroll records and inaccurate employment histories.

Following the audit findings, Public Service Cabinet Secretary Geoffrey Ruku formally handed the report to the Directorate of Criminal Investigations (DCI) for further investigations and possible prosecution of those responsible.

The government has since pledged to recover any funds lost through fraudulent salary payments while strengthening payroll management systems across all public institutions.

PSC Raises Concerns Over Compliance

Beyond payroll management, Meja criticized some ministries, departments and agencies for failing to implement PSC directives promptly.

He noted that delays in adopting commission recommendations continue to slow public sector reforms intended to improve efficiency, transparency and accountability.

The PSC chairperson also expressed concern over what he described as poor participation by some government institutions during policy formulation exercises.

According to him, HR practitioners should play a more active role in shaping policies because they are responsible for implementing them within government institutions.

“We have noticed low responsiveness by MDAs when required to submit views during public participation stages of policy formulation, and going forward, we expect robust participation and input, especially from HR practitioners who are the key implementers.” Meja said.

Government Intensifies War Against Payroll Fraud

The renewed crackdown reflects the government’s broader effort to seal financial loopholes that have cost taxpayers billions of shillings over the years.

Authorities believe payroll fraud remains one of the largest sources of wastage within the public service, making stronger oversight and digital verification systems essential.

The PSC says it will continue monitoring compliance across all ministries, departments and agencies while working closely with investigative bodies to ensure those involved in payroll manipulation are held accountable.

As investigations into the Ksh6.2 billion payroll scandal continue, public institutions have now been put on notice that any salary payments processed outside the official government payroll system could attract disciplinary and legal consequences, with HR officers expected to serve as the first line of defense against fraud.

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PSC Cracks Down on Payroll Fraud, Warns HR Officers Over Illegal Salary Payments Outside Government System