SRC rejects pressure to increase pensions for former MPs

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SRC rejects pressure to increase pensions for former MPs


gitau

Anne Gitau, CEO of the Salaries and Remuneration Commission (SRC). PICTURES | FRANCIS NDERITU | NMG

The Salaries and Remuneration Commission (SRC) has rejected a proposal to increase the amount of pension paid to ex-MPs.

Kimilili MP Didmus Barasa’s Parliamentary Pensions (Amendment) Bill 2023 seeks to amend section 8 of the Parliamentary Service Act, to allow former MPs who served between July 1, 1984 and January 1 2001 to receive a monthly pension. of 100,000 shillings.

“A former MP who, having served in Parliament between July 1, 1984 and January 1, 2001, is entitled to a pension and whose monthly pension amounts to less than 100,000 shillings, will be entitled to a monthly pension of 100,000 shillings. “, we read in the bill.

SRC CEO Anne Gitau, however, said in a memorandum to the National Assembly that retirement is a professional benefit and therefore falls within the commission’s mandate, adding that “any legislative proposal or revision thereof is subject to the mandate of the commission as provided for in the constitution”.

Read: MP staff headed for highest salaries in PSC proposals

“In view of the ongoing situation, we believe that the legislative proposal to review the pension benefits of state civil servants in Parliament contravenes the mandate of the SRC,” the CEO said.

Section 230 (4) (a) of the Constitution empowers the SRC to fix and regularly review the remuneration and benefits of all public servants, including MPs.

Records show there are approximately 160 retired deputies who served between July 1, 1984 and January 1, 2001. There are also approximately 130 widows/widowers.

Currently, only MPs who serve for at least two terms are eligible for a lump sum of Sh7 million before 30 percent tax and a monthly pension of Sh118,000.

Those who have served less than ten years are entitled to a service gratuity at the rate of 31 percent of their basic salary and a reimbursement of their contribution plus 60 percent of the government contribution.

The Parliamentary Budget Office (PBO) has already projected that this would cost the government at least Sh180.9 million per year in enhanced pension for former MPs, something the SRC is not comfortable with while it is struggling to reduce the country’s wage bill to manageable levels. .

Read: MPs in talks with SRC over scrapped benefits

This means at least Sh15.08 million monthly increase, if the proposed amendments become law, something the SRC is not comfortable with.

“Any public institution that wishes to review the remuneration and benefits of its state employees, including pensions, is required to submit a written request to the SRC, providing among other things the justification for the request and confirmation of the availability of funds for the proposed revision,” says Ms. Gitau.

Mr Barasa says his proposal draws on recommendations from a report to Parliament by the late Court of Appeal Justice Akilano Akiwumi.

“The Akiwumi report is what the amendment bill aims to implement. The former MPs concerned should receive pensions similar to those currently received by MPs. Let us give the National Assembly an opportunity to deliberate on this bill,” Mr Barasa said.

The pension amount proposed for retired MPs represents a significant improvement on the 3,950 and 5,000 shillings received by those who served between 1984 and 2001, although others earn nothing.

Those who served between 2001 and 2009 receive Sh68,000 monthly pension, with widows and widowers receiving an average of Sh16,500 per month as entitlement.

The majority of retired MPs earned a salary of less than Sh100,000 per month during their tenure, hence the low amount of their pension.

Currently, an MP earns a monthly gross salary of Sh710,000, enjoys huge allowances as per the SRC Gazette Notice of July 28, 2022, travels first class and also controls the National Development Fund of the Government and constituencies (NG-CDF).

After the 2010 Constitution, the law was amended such that an MP who serves at least two terms is automatically entitled to a contributory pension.

Read: MPs must align the CDF with the law to keep the billions from the project

Those who served between the independence years of 1963 and 1984 were never entitled to a pension scheme as there was no such law at the time.

Mr Barasa’s bill is a carbon copy of a proposal sponsored by Parliament Minority Leader John Mbadi and passed during the 12th Parliament but rejected by immediate former President Uhuru Kenyatta on the advice of the SRC chaired by Ms. Lyn Mengich.

The SRC, while opposing the bill, said that increasing the pension of former MPs would put pressure on the wage bill, “which is a big problem for the economy given the objective of the government to reduce recurrent expenditure to reduce growing debt.

At the time, the SRC also noted that the implementation of the proposal could attract similar requests from other civil servants – retired judges, permanent secretaries and former senior civil servants who, due to from their previously low salaries, receive very modest pensions.

The Akiwumi Tribunal was appointed in January 2009 by the Parliamentary Service Commission (PSC), then chaired by former Speaker of the National Assembly, Kenneth Marende, to review the employment conditions of MPs and employees of Parliament.

The tribunal extracted its findings from the Commonwealth Parliamentary Association (CPA) and submitted its report on 2 November 2009.

One of his recommendations to the PSC was that the then 500 former MPs should receive the equivalent of Sh100,000 as pension from July 1, 2010.

The PSC adopted the report in June 2010 but also recommended an enhanced pension for former MPs who served between 1963 and 1983 to meet the needs of all legislators who served the country at the national level.

Although part of the report was executed, the implementation of the pensions part of the report was ignored and has since been left to gather dust on the shelves.

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