The cost of serving on state corporation boards is set to rise after the Salaries and Remuneration Commission (SRC) approved a new package that increases monthly payments for chairpersons to Sh130,000 and raises allowances paid to members for attending meetings.
The changes will see board chairpersons receive Sh50,000 more every month, while other directors will earn Sh30,000 for each board meeting they attend, compared with the previous Sh20,000. Chairpersons will receive both the monthly honorarium and the sitting allowance.
SRC chairperson Sammy Chepkwony outlined the revised rates in a letter dated October 13, 2026, addressed to State Corporations Advisory Committee (SCAC) chairperson Philip Mong’ony.
The commission approved the package at its October 6 meeting following a request from SCAC submitted in June.
The adjustments cover several aspects of board remuneration, including telephone allowances, meals, transport, travel expenses and medical protection. The new provisions also set limits on payments by state corporations and spell out how existing board members will be treated.
Chairpersons who previously received Sh80,000 a month will now earn Sh130,000, translating into an additional Sh600,000 annually before sitting allowances and other benefits.
For a chairperson attending four meetings in a month, sitting allowances would amount to Sh120,000. Added to the monthly honorarium, this would bring the total to Sh250,000 before telephone allowances, travel facilitation and insurance benefits.
Board members who attend four meetings in a month would collect Sh120,000 in sitting allowances, excluding other entitlements under the new arrangement.
With approximately 290 state corporations operating in the country, the revised payments are expected to increase expenditure on board remuneration. The source figures put the additional cost of monthly honoraria alone at Sh174 million, although the calculation requires verification against the number of eligible chairpersons and the applicable rates.
The commission has also adjusted telephone allowances, with chairpersons set to receive Sh7,000 monthly and other board members Sh5,000. The previous rates for the two categories are not clearly stated in the available text.
Where a board meeting does not provide lunch, members will qualify for a daily allowance of Sh2,700. This represents an increase of Sh700 from the previous amount.
The new guidelines further provide for transport reimbursement where a state corporation does not make official transport available. Refunds will be calculated using Automobile Association rates.
Board members travelling on official business will also qualify for local and international daily subsistence allowances based on the rates applicable to the equivalent of Job Group U.
The grade is equivalent to that of chief executive officers, who can receive up to Sh22,000 a day in subsistence allowances.
Medical benefits have also been included in the revised package. The cover provides for inpatient treatment of up to Sh3 million annually, outpatient expenses of up to Sh200,000 and last-expense benefits of Sh200,000.
State corporations must also arrange personal accident insurance for board members undertaking official travel.
The changes come as the government continues to face pressure to contain public expenditure, with salaries and related costs accounting for a substantial share of its annual spending.
President William Ruto's administration has acknowledged the difficulty of balancing competing financial obligations against rising debt and an annual public wage bill estimated at Sh1.3 trillion.
In April 2024, the Cabinet approved updated guidelines covering the terms and conditions of service for state corporation boards and employees.
The Cabinet said the changes were intended to support President William Ruto's directives on fiscal consolidation and the management of state corporations.
Under the latest SRC decision, institutions that pay board members above the approved maximum limits must adjust their payments from the effective date specified in the commission's letter.
However, the new ceilings will not automatically change the remuneration of all serving directors. Those already in office will retain their prevailing rates on a personal-to-holder basis, subject to the terms of their current contracts.
"State corporations paying above the approved maximum ceiling will be required to comply from the effective date of this letter, except for the serving board members who shall retain their prevailing rates on a personal to holder basis subject to th current contract," Chepkwony said in the letter seen by the publication.
The provision means that the implementation of the new limits will partly depend on the contractual terms governing individual board members and the existing payment arrangements at their respective institutions.
The SRC is constitutionally mandated to determine and regularly review the remuneration of state officers. It also advises the national and county governments on the pay of other public officers.
In setting remuneration, the commission is expected to take into account the government's ability to meet its financial obligations, fairness, transparency, productivity and the need to attract and retain qualified personnel in public service.
State corporation boards oversee institutions that manage public assets, provide essential services and carry out commercial activities on behalf of the government.
Their terms of service include various forms of facilitation, with applicable guidelines providing for benefits such as telephone allowances, telecommunication devices, accommodation allowances and other approved entitlements.
The revised package sets out the payments and benefits available to board members while requiring state corporations to remain within the commission's approved remuneration limits.