The International Monetary Fund (IMF) has warned of a ticking time bomb in Kenya’s pension sector as the gap between retirement dues and actual savings continues to grow wider.
Kenya, which in 2009 opted to delay the implosion by raising the retirement age for civil servants from 55 to 60, is now facing pension obligations that have ballooned to Sh2.6 trillion — about 30 percent of GDP. This is much higher than what Kenyans pay as taxes. The country’s tax collection aggregate currently stands at 15.6 percent of GDP.
