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New twist in battle between Kenya Ports Authority and workers over Sh2b scheme

By Willis Oketch | September 29th 2015
Some of the Dock Workers Union members with their counterparts from the Kenya Ferry Services during a strike. A trustee of the Kenya Ports Authority Retirement Benefits Scheme has been sacked. [PHOTO: GIDEON MAUNDU/STANDARD].

MOMBASA: Kenya Ports Authority (KPA) Retirement Benefits Scheme trustee Fred Oyugi has been sacked.

Mr Oyugi's removal has crippled the scheme for lack of quorum of three to transact any business legally because only three out of six trustees (of the scheme) remain in office after one who is a member of the Dock Workers Union (DWU) was sacked earlier this year after a strike at the port.

A second trustee, who was a KPA director, ceased being a member last month after her contract ended and was not renewed. The two trustees, who are elected by members of the scheme, have not been replaced. Oyugi was appointed by KPA, which is a sponsor of the scheme.

Top KPA managers and the pension scheme's directors are locked in fierce battles in boardrooms and in the courts over the control of the Sh2 billion investments and property worth Sh700 million the pensioners want to buy in Kilifi County.

The crisis began early this year when the pension scheme members tried to invest Sh700 million in property in Kilifi and even paid a Sh70 million downpayment, against KPA's will.


The pensioners then went to court in April and obtained orders against KPA's interference in the management of the scheme but KPA also obtained separate orders suspending the proposed purchase of the Sh700 million property.

By the time KPA obtained orders suspending the transaction, the pensioners had already released Sh70 million to the lawyer of the company that wants to sell the property.

KPA claimed the company the pensioners want to buy the property from does not legally own it and accused the scheme members of having a covert plot. The matter is pending in the Court of Appeal.

The removal of the chairman on September 24 forced the scheme's administrator Maurice Amahwa to cancel the annual general meeting, which was to take place last Saturday as there was no quorum. Paul Arigi, a trustee, confirmed the meeting was cancelled because the chairman, who was to preside, had his appointment as trustee revoked.

"The meeting was cancelled last Friday by the administrator after KPA management revoked the appointment of Oyugi, who was to preside over the meeting as its chairman," Arigi said on Sunday.

Oyugi's appointment was revoked by KPA Managing Director Gichiri Ndua in a letter dated September 24 after a board meeting chaired by Marsden Madoka sanctioned his sacking.

In the letter, Oyugi was ordered to hand over the trustees' property before midnight on September 24 ahead of the meeting. The letter partly reads: "This is to notify you that the board... resolved to revoke your appointment as trustee of KPA Retirement Benefit Scheme with immediate effect."

Oyugi is among the trustees who had sued KPA in a case that is pending before the Court of Appeal. The court will tomorrow rule on whether KPA had a right to interfere with the running of the scheme. Trustees say KPA's mandate as the sponsor ends after they have submitted the contributions of the workers to the scheme's fund.

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