Kenyan workers who lose or change jobs will longer wait until they are 50 years old to able to access their employers’ pension contribution. This is because Kenyan law makers in a landmark move have annulled a legal amendment that had locked workers’ savings until they reach 50 years.

Here Is All You Need To Know

• Kenyan MPs said that National Treasury and the Retirement Benefits Authority (RBA) did not properly seek views of Kenyans before adopting the legal notice that effectively locked more than Sh385 billion in the pension pools.
• According to them, the legal changes had far-reaching implications and termed the public participation exercises conducted by Treasury and RBA as ‘mediocrity’.
• Suspended Treasury Secretary Henry Rotich locked up the savings through Legal Notice 92. Observers said the move was meant to give the State access to long-term loans from the billions held by Kenyans in pension savings.

“The two are very important but our law is very clear that we comply with all constitutional requirements,” Kirinyaga Central MP John Wambugu said.

• The move is a reprieve for Kenyans who risked not enjoying their savings until they hit 50 years.
• Last month, Kenya’s industry regulator warned that pension schemes risked incurring huge income loss if retrenched workers were allowed to access their employers’ contribution before attaining 50 years as had been recommended by the parliamentary Committee on Delegated Legislation.

“It is a sad moment for the retirement benefits industry as the parliamentary committee rejected our proposal to Treasury,” RBA chief executive Nzomo Mutuku said.

• Read also: Kenya Set To Offer Citizenship To Wealthy Foreign Investors
• The agency maintained that Kenya was in low pension adequacy, blaming it on frequent access to the benefits by individuals before their retirement with 95 percent of individuals who leave employment taking out the maximum available under legislation in cash.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world