City Hall will spend Sh175 million for voluntary early retirement of its older staff and payment of terminal benefits to retirees.
It aims to reduce its bloated wage bill and inject new blood.
The allocation will allow the county to launch the much-awaited early voluntary retirement scheme for staff 50 years and older.
The budget is part of the second supplementary budget approved by the assembly two weeks ago.
However, Assembly Budget committee chairman Robert Mbatia said the scheme has not been implemented as staff feared they would go home without retirement packages.
“Having this amount allocated to retirees will pave way for roll out of the scheme. Having cleared this, will be able to bring in fresh blood," he said.
The voluntary early retirement policy was developed in 2018 but delayed for undisclosed reasons.
In FY 2018-19, only 400 of the targeted 731 workers voluntarily retired between July and January 2019.
In the same year, Sh1.3 billion was spent monthly to compensate employees.
According to City Hall records, in FY 2017-18, Sh14.84 billion was spent as wages for 12,496 staff, representing 56 per cent of revenue collected that year.
This violates the Public Finance Management Act which, which requires a county wage bill shall not exceed 35 per cent of its total budget.
Nairobi Devolution and Public Service Management CEC Veska Kangogo disclosed very many elderly staff are to retire by June 30, 2021, as the financial year ends.
“We have many old employees set to go home, hence, the allocation. Our administration work is to make sure their benefits are ready so when they retire they have their money," she said.
A biometric report released in November 2019 showed despite the acute youth unemployment in the country, only 14 per cent of the workers were young, or 792 of the 11,603 employees.
The workforce has 6,118 women and 5,485 men.
Of the 11,603, 5,709 are aged 50 and above; 19 are above the retirement age of 60.
A total 2,712 workers are aged between 55 and 59, 2,978 are between 50 and 54 years and 2,663 are between 45 and 49 years.
The report says 1,757 employees are 20 to 44 years; 1,4474 are younger than 40; 682 are between 35 and 39 years.
Out of the 792 young people, 621 are between 30 and 34 years and 171 are younger 30.
The April 2019 register indicated City Hall had 11,988 employees, however, 385 of them were not registered during biometric listing.
Of these, 200 retired between April and November 2019, 85 were training overseas, 58 were on suspension due to disciplinary issues and 23 had died.
Another 11 employees resigned during the review period.
In the Nairobi County Annual Development Plan 2021-2022, staff aged 50 years and older will benefit from an Sh100 million voluntary early retirement scheme to begin in FY 2021-22.
“Most of them have requested early retirement. We have been looking for funding and ensuring a policy is available and we are also up to date with their pension contributions,” Kangogo said.
Last year in April 6,852 county staff were seconded to the Nairobi Metropolitan Services.
In the same month, the Public Service Commission was hiring at least 1,000 Inspectorate officers to replace those heading for retirement and invigorate the department.
They included 300 enforcement officers and 700 enforcement constables.
(Edited by V. Graham)