Windfall as 5,000 retired teachers to get Sh1m each

Some of the retired teachers during a past court session in Nakuru. The money will be paid out to the teachers as accumulated arrears, following the revision of their pension, which has been backdated to 2003. [File, Standard]
After waiting for 16 years, over 5,000 teachers who retired in 2003 are now poised to get a windfall of at least Sh1 million each from the pensions department.

According to Director of Pensions Shem Nyakutu, the money will be paid out to the teachers as accumulated arrears, following revision of their pension, which has been backdated to 2003.

Although this windfall will largely benefit the lot which retired in 2003, another cohort which exited the service in 1998 will each get a consolation of Sh50,000.

But there will be no celebration for teachers who retired in 1997 as they were not factored in when the government and the Kenya National Union of Teachers (Knut) ultimately signed a salary increase agreement in 2008.

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The government will pay the 2003 lot an accumulated total of Sh5 billion. 

At the same time, the pensions boss has described as misleading reports by Auditor General Edward Ouko that Pensions Department had squandered Sh67.9 billion by paying people who had no national identity cards and personal identification numbers.

While admitting that he had indeed been paying pensioners without the vital identification documents, Nyakutu said there are legitimate explanations and the money had been paid to the rightful pensioners.

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“It is true some of the pensioners do not have national identity cards. In fact, some are not even Kenyans, but we have been paying them because they are legitimate pensioners and they are in our payroll,” he said.

The director said some of the retirees worked in the public service during the colonial times were still drawing their pension even if they do not have national IDs.

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Payroll number

Some of the pensioners had opted not to take up Kenyan citizenship after the country got independence in 1963, but were still entitled to their pension.

“We use the payroll number, so even pensioners who do not have the ID still get their pay. Until 1979, women too did not have national IDs but we have been paying them because at the time they retired we did not have their IDs,” said Nyakutu.

He said another category of pensioners who still get their pensions from Treasury although they are not necessarily Kenyans are former employees of the defunct East African Commission, which was started in 1967 and collapsed in 1977.

“It is wrong to insinuate that this money has been going down the drain because of lack of vital documents,” he added.

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The Director said his department does not require PIN of pensioners who retire at 65 years such as judges or MPs because their pensions are not taxed.

“If a judge retires at 65 or an aged MP is kicked out by his constituents, he will be entitled to his pension but it will not be deducted. So this means his or her PIN is not required,” he said.

Back to the teachers’ windfall, Nyakutu said teachers who retired in 1997 and after 2003 will not get any payments as they were not affected by the revision of their pensions.

An estimated 52,000 retired teachers have been embroiled in protracted legal battles since 1997 over the issue of pensions, although the government has disputed the number of claimants and the money they are demanding.

On October 23, 2008, the teachers thought they had scored a major victory against the government when Justice David Maraga (now the Chief Justice) who was at the time based in Nakuru ruled that the government ought to pay them their pension.

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The teachers had sued their former employer, Teachers Service Commission (TSC), complaining that they had been denied their rightful pension. Their complaint was that after they called off their nationwide strike in 1997, the government reneged on its promise to increase their pay.

By the time they retired, the government had not effected the new salaries and they had to go home with less monthly pension.

Trouble started when the government failed to honour the 1998 agreement between the TSC and Knut.

Under the scheme, all teachers who were at the time in active service and those who were on leave, pending retirement from July 1, 1997, were to get a lump sum pay over and above their monthly salaries.

Revised rates

It is estimated that at least 2,000 retirees have since died before they could get their dues, even as their aggrieved colleagues pursued the government under an umbrella body, Retired Teachers 1997 Group, to pay their dues.

Yesterday, the pensions boss said his department has started paying the revised rates to affected teachers. According to an audit by the Auditor General covering 2012/13, Sh44 billion had been paid to claimants with irregular identities or had no PINs while another Sh21 billon was given to claimants with shared bank accounts.

Nyakuti said the auditors had disregarded his explanation that some retired couples who once worked in the public service operated the same accounts.

According to the audit, 349 claims did not have regular identification documents, while 962 pensioners were paid their lump sum before the exit date.

The  audit also indicated that 870 account numbers were shared by 29,387 pensioners while in other cases some accounts did not follow the conventional rules, leading the auditors to conclude payments were made irregularly.

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Kenya National Union of TeachersRetirement benefitsPension