Members of Parliament have criticised the Retirement Benefits Authority (RBA) for failing to ensure timely payment of pensions to retired staff from several state agencies, saying the delay has left many former public servants suffering in poverty.
The Departmental Committee on Finance and National Planning expressed disappointment during a meeting with officials from the National Treasury and RBA, who were appearing on behalf of the Cabinet Secretary for National Treasury and Economic Planning, John Mbadi. The session was convened to respond to a statement requested by Kilifi South MP Ken Chonga regarding delayed pension payments at the National Water Conservation and Pipeline Corporation (NWCPC).
Committee members accused the RBA of failing to act against state agencies that have ignored their obligation to remit pension contributions. They said the inaction had condemned retirees to years of financial hardship despite faithfully contributing to their retirement funds.
“We share the same pain as legislators of people whose pension payouts are stuck. What this Committee needs to know is, if these former employees contributed towards their pension and the agencies made their part of contribution, where is the money?” asked Session Chair and Kitui Rural MP David Mboni.
Committee Member Andrew Adipo also faulted the Authority for what he described as a casual approach to a serious issue.
“Someone retires after contributing during their entire service, only to be told there is no money. This is not a matter to be taken casually,” he said.
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Butula MP Joseph Oyula added that the situation was unacceptable, saying that every retiree deserves a clear breakdown of their expected benefits.
“When the employee and the employer have both made their contributions, the beneficiary should be given a full breakdown of what they are owed. If the money is missing, it means someone has diverted it,” he said.
Kesses MP Julius Rutto, who has been following the stalled Sh4 billion pension payout for retired Moi University employees, urged the RBA to streamline the management of pension funds across all sectors.
Responding to the concerns, RBA Chief Executive Officer Charles Machira said the NWCPC had failed to remit pension contributions for its staff as required, even as the scheme’s actuarial deficit continued to widen.
“The water agency bodies formed after the sector reforms neglected their obligations in terms of remitting pension contributions to the NWCPC Superannuation Scheme for employees they took over,” Machira told the Committee.
When asked what measures the RBA had taken to fix the problem, Machira said the Authority had proposed amendments to the Retirement Benefits Act in the current financial year.
“The goal is to penalize employers who fail to remit pension contributions and empower the Kenya Revenue Authority (KRA) under Section 53 of the Act to recover unremitted pension contributions from employers,” he explained.
However,Chonga expressed dissatisfaction with the response, demanding to know when the remaining 60 percent of unpaid benefits for NWCPC retirees would be released.
“These retirees were told there is no money, yet deductions were made from their salaries. The National Treasury and RBA must ensure they are paid,” Chonga insisted.
In his directive, Chair David Mboni ordered Treasury officials, led by CS Mbadi, to reappear before the Committee on October 23. They are expected to come with both current and former executives of the affected water agencies.
