There is need to review the pensions law to ensure what retirees are paid reflects prevailing cost of living, Labour and Social Protection CS Ukur Yatani has said.
"In pursuit of your association's objectives, working in close collaboration with your representatives, my ministry has developed a memorandum that will be submitted to the Cabinet soon for consideration and necessary action,” said Mr Yatani during the annual general meeting of Kenya Association of Retired Officers (KARO).
The memorandum highlights, among others, consideration for revision of various Acts, especially the Pensions Act, to address existing disparities and inequalities in payment of pensions.
"The desirable feature of any retirement benefit scheme is that pension payment should be adjusted according to cost of living, as this provides for the pensioners’ standard of living to be maintained in retirement in terms of their purchasing power,” said Yatani.
He said the current scenario had condemned retirees to poverty.
"The memorandum also includes consideration for review of the Widows and Children’s Pensions Act so the scheme can include widowers. This will make it compatible with the provisions and spirit of our current Constitution on equality and fair labour practice," Yatani said.
Other considerations are review of the Pensions Increase Act to reflect the current economic status of the country.
Other initiatives to address the plight of retired officers include the Salaries and Remuneration Commission recommendation of 2014, which noted absence of regular review and increase of pension before 2005, which severely eroded the purchasing power of pensioners.
It recommended a one-off increment of pension, but which is yet to be implemented.
“It has also been noted that pension benefit is less than the average absolute poverty average of Sh4,624 per adult per month. Sadly, according to the 2018 Kenya National Bureau of Statistics survey, it has been realised that of the 220,000 public service retirees drawing pension, about 25 per cent earn less than Sh4,000 per month. This sorry state of affairs needs immediate intervention,” said Yatani. [James Wanzala]