The Treasury has announced the return of ghost workers to the national payroll, less than five years after an audit led to the removal of more than 12,000 false names from the public sector salaries register.
Ghost workers are those who have died, retired or deserted duty.
Acting Treasury Secretary Ukur Yatani said weak payroll systems at both county and national government levels had made it easier to manipulate the payroll to include fictitious names as State employees.
A preliminary audit found that some government ministries, State-owned agencies and commissions that employ large numbers of staff continue to pay officers who are no longer in service.
The removal of ghost workers from the payroll is one of the strategies, together with a freeze in new hiring and pay increases, aimed at reducing Kenya's ballooning public sector wage bill.
"There is a problem with weak payroll management systems. A number of payrolls are still populated with ghost workers earning money from the Exchequer and yet they cannot be found," Mr Yatani said at a press conference in Nairobi Tuesday.
In 2014, a preliminary audit of the public service payroll revealed that taxpayers were losing more than Sh1.8 billion annually in salary payments to ghost workers. This emerged after 12,500 names of government employees failed to reflect during the biometric registration, forcing the State to strike them off from the payroll at the start of November 2014.
Now, the Salaries and Remuneration Commission (SRC) is recommending an upgrade of the integrated payroll management system to give each public servant a unique identifier so as to eliminate the risk of overpayment or paying ghost workers.
Treasury is also seeking to restrict pay allocation to departments and State agencies to workers whose details are in the core electronic payroll.
This means that funds for salaries will now be allocated to government and parastatal workers whose details are loaded onto the payroll system, which is technically known as Integrated Personnel Payroll Data (IPPD).
Kenya's public sector wage bill stood at Sh792 billion in the year to June, and is nearly half the Sh1.4 trillion the Kenya Revenue Authority (KRA) collected as taxes in the same period.
This is way above the 35 percent ceiling of revenues set in the Public Finance Management Act.
The wage bill has nearly doubled from Sh413 billion in 2014 on the back of a hiring spree in counties with the onset of devolution in 2013.
The government has frozen hiring for the next three years in an austerity measure aimed at reducing the country's wage bill so as to free resources for development projects.
There will be no recruitment of staff in the next three years unless a ministry, State department or agency (MDA) gets approval from the Treasury.
"Right now we have so many public servants who can't give you their job description. Playing second fiddle to productivity has to stop," said SRC vice chairperson Dalmas Otieno.
SRC has accused government officers of multiplying the number of allowances from just 11 in 1999 to 247.
More emphasis was put on allowances starting 2015 as government saw it as an alternative to controlling its pension bill by not raising salaries. The perks account for about 40 percent of the wage bill.
Kenya an estimated 842,000 government employees including those in the civil service, teachers, parastatal employees and those working in companies majority-owned by the State. In 2014, the country had 732,000 employees.