Kiambu Senator Karungo wa Thang’wa on Wednesday, November 5, 2025, dismissed assertions by Treasury Cabinet Secretary John Mbadi that Kenya’s public sector wage bill is unsustainably high. This exchange brings to the forefront the persistent and critical challenge of managing government expenditure against national revenue, a cornerstone of Kenya's economic stability.

Speaking on Wednesday morning, Senator Thang'wa, a member of the ruling UDA party, countered the narrative of a fiscal crisis, suggesting the concerns were overstated. While the Senator's detailed counter-arguments were not immediately available, his position represents a defense of the government's current fiscal management. (FURTHER INVESTIGATION REQUIRED).

The debate was ignited by remarks made by Treasury CS John Mbadi before a parliamentary committee on Monday, November 4, 2025. Mbadi, who assumed the Treasury docket in August 2024, warned that the rising expenditure on public salaries poses a serious threat to economic development and fiscal stability. He revealed that the monthly government wage bill had escalated from KSh 75 billion in January 2025 to KSh 80 billion, amounting to an annual expenditure of KSh 960 billion.

“In 2013, only 16 per cent of our ordinary revenue was used to pay public salaries. That figure has now risen to over 40 per cent... It is not sustainable. We will end up crowding out capital expenditure,” Mbadi stated, emphasizing that continued growth in the wage bill would squeeze funds available for development projects.

The Data Behind the Debate

Official reports from Kenya’s key fiscal institutions paint a complex picture. The central issue is the public wage bill-to-revenue ratio, which the Public Finance Management (PFM) Act stipulates should not exceed 35%. However, this ceiling has been consistently breached.

According to the Salaries and Remuneration Commission (SRC), the wage bill-to-ordinary revenue ratio was projected to be 40.6% by the end of the 2024/2025 financial year. This figure is down from a high of 51.54% in the 2017/2018 fiscal year, but remains significantly above the legal limit. The government has a stated goal to reduce this ratio to the 35% threshold by 2028 to free up more funds for development.

The Controller of Budget has also repeatedly raised alarms, particularly concerning county governments. A September 2025 report revealed that 39 county governments had exceeded the 35% ceiling in the 2024/2025 financial year, with some dedicating as much as 55% of their revenue to salaries. For the fiscal year ending in June 2025, counties spent KSh 220.64 billion on employee compensation, representing 47% of their total expenditure.

Implications for Kenya's Economy

A high public wage bill directly impacts every Kenyan. It limits the funds available for essential services and development priorities, such as constructing roads, equipping hospitals, and funding education. To cover the shortfall, the government must either increase taxes or borrow, both of which have significant economic consequences. The total number of public servants surpassed one million in 2024, with the Teachers Service Commission (TSC) being the largest single employer.

In response to these pressures, the government has previously announced austerity measures. In June 2024, the then Treasury CS Njuguna Ndung'u announced a suspension of all new recruitment in the public sector for a year, alongside freezes on foreign travel and other non-essential expenditures. The SRC has also been actively managing the wage bill, launching a five-year strategic plan in October 2025 aimed at enhancing efficiency and curbing unsustainable growth. The commission noted that it had reviewed salary increase requests amounting to KSh 70.95 billion in the 2024/2025 fiscal year, approving KSh 43.19 billion.

The public disagreement between Senator Thang'wa and CS Mbadi underscores the deep political and economic divisions over how to manage the country's finances. As policymakers debate the numbers, the underlying challenge remains: balancing the need for a productive and fairly compensated public service with the fiscal reality of the national budget, ensuring that development and service delivery are not compromised.