Railway settles Sh278 million pensioners' arrears

By Standard Correspondent

The Kenya Railway Staff Retirement Benefit Scheme has announced that it had paid pensioners Sh278 million as outstanding arrears and lump sum payment for retiring railway employees.

Making the disclosure, acting Chief Executive Officer, Caroline Nyororo said the total pension liability stood at Sh672 million, which will be cleared in due course.

"We are committed to settling pension arrears as soon as possible", Nyororo said.

The scheme has close to 9,400 pensioners with a monthly pension wage of Sh46 million that translates to Sh552 million annually.

According to the acting CEO, the change in the fortunes of the KRSRBS has been as a result of various strategic initiatives that are being implemented in phases by the Board of Trustees.

Liquidity position

The latest payment, Nyororo said, was made possible by a combination of strategies including refurbishment of selected KRSRBS properties to realise their full commercial potential, the selling of a few of these properties to help improve the liquidity position and maintaining portfolio balance.

Nyororo further said that the board had agreed to redevelop other KRSRBS properties on a joint venture basis and through equity participation to generate the much needed funds to create financial stability within the scheme.

The Kenya Railways Staff Retirement Benefits Scheme was established and registered by the Retirement Benefits Authority in May 2006. It was mandated to pay retirement dues to its members upon retirement from the Kenya Railways Corporation. The scheme inherited liabilities estimated at 12.6 billion shillings at the time.

During the process of concessioning, the Government through Kenya Railways Corporation set aside assets valued at Sh12.4 billion that were later transferred to the pension scheme through a legal notice.