MPs demand audit of TSC payroll over Sh446m salary overpayment

TSC CEO Nancy Macharia before the National Assembly's PAC committee at the Parliament buildings, Nairobi. February 20th,2024. [Elvis Ogina, Standard]

Members of Parliament have called an audit of the Teacher’s Service Commission (TSC) payroll following revelations of overpayment of salaries amounting to Sh446 million.

MPs were shocked to learn that some of this money had been used to pay dead teachers.

The details came to light during National Assembly Public Accounts Committee (PAC) sitting where the TSC Chief Executive Officer Nancy Macharia appeared to answer audit queries raised by the Auditor General.

The queries include unexplained decrease in employer contribution to National Social Security Fund (NSSF) and staff pensions, over expenditure of budgets, cash losses and unsupported receivable balances.

The committee consequently tasked Macharia to explain the overpayments following revelations that the same had been verified as having been paid to dead teachers, those who had deserted duty, resigned, transferred, interdicted or had been absent from duty.

“If members feel that there is an issue with TSC systems then this committee is at liberty to recommend for an audit into its payroll,” stated PAC chairperson John Mbadi.

In response, Macharia admitted that indeed there were overpayments of salaries for the period under review and the same had grown over the years due to manual reporting systems that were inefficient.

“Salary overpayment occurred as a result of delay in stoppage of salary of employees upon death, desertion of duty, resignation, transfer of service, transfer, sick leave, interdiction and absenteeism,” she told the MPs.

She however said that remedial measures had been instituted by the commission to recover the money and also avert such occurrence in future.

“To address the issue of salary overpayment, the commission has developed an overpayment policy and online services to improve efficiency in reporting mechanisms between the commission headquarters, field offices, and schools in respect to death, desertion of duty, resignation, transfer of service, retirement, sick leave and absenteeism,” she said.

The CEO also submitted that other than sensitising heads teachers, sub- county directors and county directors on overpayment, TSC had written to the beneficiaries of the overpayments to return the funds. In cases where payments were made to the dead, their families were contacted.

According to various letters submitted as evidence by TSC, Sh260,110 was paid to Sawe Robert Kipleting between December 12, 2020 to April 30, 2021, at a time the teacher was dead. In a bid to recover the money, the commission wrote to Alice Sawe- a relative.

“This is to notify you that the late Sawe Robert Kipleting was paid undue amount of Sh260,110.75 for the period 12.12.2020 to 30.4.21 being salary and allowances earned erroneously after death. The commission demands that you settle the amounts said in cash payable to TSC through National Bank of Kenya,” read the letter signed by S Cherono on behalf of the CEO. Linda Chepkemoi Sigey had also been erroneously paid Sh10,541 after her death between April 20, 2021 to April 30, 2021.

Chemtai Caroline had also been unduly paid Sh5,061 after her death between April 25, 2021 to April 30, 2021.

“We need an audit of the payroll. There seems to be a lot of issues given that some teachers do not go to class for a year and are still paid whereas others work for as long as six months without pay only to be told that their salaries have been going to a different account,” said Funyula MP Wilberforce Ounda.

Soi MP Kiplagat David Kiplagat sought to know why the office of the Auditor General had not yet conducted a system audit of TSC.

“Don’t you think there is something wrong with the TSC given that its systems seem to have a lot of loopholes?” Posed Kiplagat.

The House team, through a submission by office of the Auditor General, heard that there was an unexplained salary overpayment of 466,892,922 for the 2021/2022 financial year. The figure was a Sh114.03 million increase in salary overpayments compared to the Sh352.9 million paid in the previous financial year.

“…however, the origin and build-up of the balance has not been explained. In addition, the management has not demonstrated efforts it has made to recover the salary overpayments, thus the recoverability of this is doubtful,” read the report by the Auditor General.

At the same time, the exact number of teachers employed by the TSC came under sharp scrutiny yesterday after the commission was unable to explain its under- absorption of Sh300 million allocated for teacher pensions in the 2021/2022 financial year.

A report by the Auditor General had flagged the unspent surplus of Sh300 million that the TSC had requested to cater for staff pensions but failed to utilise by the end of the fiscal year under review. The committee therefore sought to know how pension money dropped while the number of teachers was on the rise.

“If this is actual expenditure, then we need to understand why so much more was spent in the previous year compared to the subsequent year, especially considering an increase in the number of teachers on the payroll,” Mbadi said.

Macharia attributed the excess budget to projections based on an evaluation report conducted during the transition of a new pension scheme model.

The Auditor General, however, contradicted the TSC’s explanation on Tuesday stating that the flagged figures in their audit report represented actual payments, not estimates.

“These figures are from statements of receipts and payments, a financial statement of the commission, and are part of actual payments, not just a budget,” the Auditor General said.

Mbadi has now directed the TSC and the Auditor General to engage and provide a unified response on the true status of the unutilised funds within a week.