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Workers, Unions and Employers oppose CS Rotich's contribution plan

By Rawlings Otieno | June 21st 2018
National Treasury Cabinet Secretary Henry Rotich. [JOHN MUCHUCHA, STANDARD]

Representatives of workers, employers and MPs have opposed a plan to compel all employees to contribute a fraction of their salaries to fund a Government housing project.

The Federation of Kenya Employees (FKE), the Kenya Union of Post-Primary Education Teachers (Kuppet), the Kenya National Union of Teachers (Knut), the Kenya Universities Staff Union (Kusu), the Union of Kenya Civil Servants (UKCS) and the Universities Academic Staff Union (Uasu) opposed the planned contribution to the National Housing Development Fund (NHDF), citing lack of consultation.

In his budget speech last Thursday, National Treasury Cabinet Secretary Henry Rotich said employees would contribute 0.5 per cent of their gross monthly pay to the fund, but a draft legislation quoted one per cent, which the CS has claimed was an error that would be rectified in Parliament.

The groups want Mr Rotich to shed light on how the fund would be managed, whether contributors would be allocated houses after construction and what criteria would be used to allocate the houses.

In his speech, Rotich said he intended to submit a proposal to Parliament on ways to help the Government achieve its agenda on housing.

But workers' representatives are reading a sinister motive in the latest statutory deduction.

Already all employees are contributing to the National Health Insurance Fund (NHIF) and the National Social and Security Fund (NSSF) through statutory deductions.

The employers, on the other hand, have questioned whether the contributions would translate to actual housing for the employee within a given span of time which has not been specified in the proposed amendments.

FKE Chief Executive Officer Jacqueline Mugo said it was not clear what role both employers and workers would play in the management of the fund and how it related to the Housing Fund provided for in the Housing Act.

She said employers were already providing housing or paying housing allowance to employees of at least 15 per cent of their basic pay.

“What benefits are there in it for the employers and employees? Is it guaranteed that every employee who contributes will get a house or access to a credit facility guaranteed by that fund? The proposed amendment does not provide answers to these issues,” said Ms Mugo.

Uasu Secretary General Constantine Wasonga questioned the benefit of the housing scheme to the contributors when most members of the union contribute to NHIF but do not benefit.

Knut Secretary General Wilson Sossion said there had been no consultations over the proposal, terming it another scheme by the Government to mop up billions of shillings from poor Kenyans.

“We cannot afford to have another fund where a few individuals will siphon workers' hard-earned money. We hope Parliament will not pass this Bill blindly,” said Kusu Secretary General Charles Mukhwaya.

UKCS Deputy Secretary General Jerry ole Kina accused the Jubilee administration of imposing taxes without consultation and creating disharmony between the Government and its employees.

Amani National Congress (ANC) leader Musalia Mudavadi and MPs Sam Atandi (Alego Usonga), Omboko Milemba (Emuhaya) and Jared Okello (Nyando) opposed the plan, saying it could be another cash cow meant to enrich certain individuals.

Kiambu Woman Representative Gathoni wa Muchomba, while lauding the proposal, cautioned that care should be taken to safeguard the fund.

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