Controller of Budget Margaret Nyakang’o exposes “ghosts’ paradise” in government spending
Speaking during a recent oversight forum, Nyakang’o noted that loopholes in payroll systems, weak procurement controls, and deliberate manipulation by officials had created fertile ground for ghost workers and fraudulent payments
Controller of Budget Dr. Margaret Nyakang’o has lifted the lid on what she described as a “ghosts’ paradise” thriving within the country’s public finance system, warning that billions of shillings are being lost to fictitious workers, inflated contracts, and non-existent projects.
Speaking during a recent oversight forum, Nyakang’o noted that loopholes in payroll systems, weak procurement controls, and deliberate manipulation by officials had created fertile ground for ghost workers and fraudulent payments.
“We are literally feeding ghosts in this country. Public money meant for development and services is ending up in the pockets of individuals who don’t exist or for work that is never done,” she said.
She revealed that preliminary audits had uncovered thousands of “employees” still drawing salaries long after retirement, resignation, or even death.
In September last year, 2024, A report by the Controller of Budget revealed that county governments are still using manual payrolls to pay their workers, a practice that has led to a loss of public funds and allowed for the potential existence of ghost workers.
The report shows that for the financial year ending June 30, 2023, counties disbursed Sh16billion in salaries through manual payroll systems, despite a directive to use integrated personal payroll databases (IPPD).
Further, the review tabled in the National Assembly also highlighted that seven per cent of the Sh208billion wage bill was processed manually across all 47 counties.
The report has raised concerns that some county officers could be taking advantage of the system to hire ghost workers, with Nairobi, Siaya, and Homa Bay among the counties flagged for these dubious payments.
In Siaya, an audit ordered by governor James Orengo exposed 111 ghost workers.
A task force, chaired by William Ouko, found the issue most prevalent among casual hires. Homa Bay’s case was even more alarming, with a Price Waterhouse Coopers audit uncovering over 1,780 ghost workers who collectively pocketed Sh300 million annually.
Wajir County also appeared in the report, having paid Sh622million via manual payrolls. Some of the payments were linked to specific programmes such as Community Health Volunteers and the Women’s Empowerment Programme.
Machakos, Nakuru, and Busia counties each processed Sh582million manually, while Marsabit and Laikipia processed Sh562 million and Sh528 million, respectively.
Additional counties, including Garissa (Sh480 million), Mombasa (Sh435 million), and Nyeri (Sh413 million) were cited for large manual payouts. Smaller counties like Lamu and Tana River also featured in the report, raising concerns about payroll manipulation.
Some counties and state agencies, she added, were notorious for padding their budgets with questionable allowances and phantom projects.
Nyakang’o urged Parliament, investigative agencies, and the National Treasury to tighten financial reporting and enforce accountability across ministries, counties, and parastatals.
“Kenyans are overtaxed but underserved because resources are diverted to ghost schemes. This must end if we are to restore confidence in public finance management,” she emphasised.
Her revelations have sparked fresh calls for lifestyle audits, payroll clean-ups, and prosecution of officials found culpable.
Civil society groups have also demanded publication of payroll data and procurement records to expose the so-called “ghosts’ paradise” undermining service delivery.
