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Economy

Counties fail to remit Sh18.6bn in pension contributions

Nairobi skyline. Nairobi County accounts for the largest share of delayed pension remittances to Laptrust at Sh10.71 billion in December 2016. file photo | nmg
Nairobi skyline. Nairobi County accounts for the largest share of delayed pension remittances to Laptrust at Sh10.71 billion in December 2016. file photo | nmg 

Local Authorities Pension Trust (Laptrust) said on Friday the value of outstanding pension remittances and accrued interest from its key sponsors jumped to Sh18.6 billion in September from Sh14.42 billion in December 2016.

The major debtors are Nairobi and Mombasa counties as well as the Nairobi City Water & Sewerage Company (NC&SC), Hosea Kili, the chief executive of CPF Financial Services, Laptrust’s administrator, said at annual general meeting in Nairobi.

Nairobi accounts for the largest share of delayed pension remittances at Sh10.71 billion in December 2016, Sh6.53 billion more than Sh4.18 billion that was inherited from the defunct Nairobi City Council in April 2013.

Mombasa County owed the scheme Sh1.82 billion, a growth of Sh668.87 million compared to what it inherited, while NC&SC owed the scheme Sh1.89 billion at end of 2016.

Rising dues

“Late remittances of contributions and failure by some sponsors to remit members contributions in full have continued to exacerbate the situation,” Mr Kili said.

“While part of the debt was inherited from the now defunct local authorities, some county governments have subsequently piled up substantial amount of debt post devolution.”

Nairobi Senator Johnson Sakaja pledged to initiate a parliamentary process to map out a strategy to ensure the rising dues are settled gradually possibly using funds from the Conditional Grant.

“Nairobi is leading in debt and … we have to see how we can sort this out because it is those who have given services to Nairobi who are suffering,” Mr Sakaja said.

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