New government should improve retirees' welfare

Samson Cherambos, former Presidential escort commander under President Daniel Moi receive presents from a group of former and serving police officers who paid him a call at his Kobujoi home in Nandi County. [Courtesy]

The dawn of a new government has the citizens' hopes high. The expectation is that those elected will improve the quality of life. The youth are hoping for job opportunities, businesspeople are looking forward to a conducive economic environment. Similarly, improvement in retirees’ welfare for a dignified retirement life is part of the expected deliverables. At present, Kenyans above the age 60 years account for about 10 per cent of the population.

With asset growth from Sh40 billion to Sh1.6 trillion over the last two decades, the Retirement Benefits Authority (RBA) has come a long way in policy formulation, retirement planning, education and providing effective pension regulatory oversight. Still, we can always shift the goal posts and aim for more positive changes.

Retirees face economic difficulties caused by the rising cost of living due to international crises like global inflation and the Russia-Ukraine conflict, among other factors. As a priority, the government ought to make life bearable for senior citizens. Basic commodities should be made affordable and while subsidies provide temporary relief, the spending needs to be kept in check.

The outgoing government has been keen on providing Universal Health Coverage which should be continued. The incidence of multiple disorders, diseases and medical conditions increase in old age. While some ailments are in some way expected and budgeted for in post-retirement medical insurance and NHIF, unforeseen disease outbreaks can drive retirees and their families to financial ruin.

The healthcare system should shift focus from cure to prevention. This is relatively cheaper and it prevents the suffering and emotional turmoil caused by disease. Another preventative measure is to educate everyone on longevity, a concept which underpins all life decisions. Retirees sometimes worry about the adequacy of their savings, how long they are supposed to last and how to cover their healthcare expenses in old age.  

Combined with advancement in technology, environmental and lifestyle changes have caused a shift in life expectancy over the years. For example, someone born in the 1960s can expect to live longer than they expected to in the 1990s. As a result, persons in their mid-years should reevaluate their retirement plans, including income adequacy, medical insurance, and so on with long life in mind.

One of the most significant developments for retirees from the outgoing regime was the pension mortgage loans regulation. The working population now has access to 40 per cent of their pension savings to secure an affordable house. As such, they can be sure to repay the loan and refill their retirement kitty before retiring. However, to ensure supply, there is need to maintain the affordable housing momentum. The new government should continue to incentivise the private sector to carry on with construction.

Mr Wafubwa is the CEO, Enwealth Financial Services