SRC rejects push for higher pension pay for ex-MPs


Salaries and Remuneration Commission (SRC) Commission CEO Anne Gitau. PHOTO | FRANCIS NDERITU | NMG

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

The Parliamentary Pensions (Amendment) Bill 2023 by Kimilili MP Didmus Barasa, seeks to amend section 8 of the Parliamentary Service Act, to allow the former MPs who served between July 1, 1984, and January 1, 2001, to take home a monthly pension of Sh100,000.

“A former MP who, having served in parliament between July 1, 1984, and January 1, 2001, and is entitled to pension and whose monthly pension amounts to less than Sh100,000, shall be entitled to a monthly pension of Sh100,000,” reads the Bill.

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

“In view of the ongoing it is our considered view that the legislative proposal to review the pension benefits of state officers in parliament infringes SRC’s mandate,” the CEO said.

Article 230 (4) (a) of the constitution empowers SRC to set and regularly review the remuneration and benefits of all state officers, including MPs.

Records show that there are some 160 retired MPs who served between July 1, 1984, and January 1, 2001. There are also about 130 widows/ widowers.

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

Those who have served less than ten years are eligible for a service gratuity at the rate of 31 percent of their basic pay and a refund of their contribution plus the 60 percent worth of government contribution.

Already, the Parliamentary Budget Office (PBO) has projected that it would cost the government at least Sh180.9 million a year in enhanced pension to the former MPs, something SRC is uncomfortable with as it struggles to reduce the country’s wage bill to manageable levels.

This means at least Sh15.08 million in enhanced monthly, if the proposed amendments become law, something that the SRC is uncomfortable with.

“Any public institution that desires to have the remuneration and benefits of its state officers including pension reviewed, is required to submit a request in writing to SRC, providing among others, justification for the request and confirmation of availability of funds for the proposed review,” says Ms Gitau.

Mr Barasa says that his proposal is informed by the recommendations of a report to Parliament by the late Court of Appeal judge Akilano Akiwumi.

“The Akiwumi report is what the amendment Bill aims to put into effect. The affected former MPs should get pensions similar to what the MPs are getting now. Let us give the National Assembly an opportunity to deliberate on this Bill,” said Mr Barasa.

The proposed pension amount for the retired MPs is a significant improvement from the Sh3,950 and Sh5,000 for those, who served between 1984 and 2001 are getting, although others take home nothing.

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

A majority of the retired MPs earned a salary of less than Sh100,000 a month during their time hence their low pension amounts.

Currently, an MP takes home a monthly gross pay of Sh710,000, enjoys huge allowances as per the July 28, 2022, SRC gazette notice, flies first class, and also controls the National Government-Constituency Development Fund (NG-CDF).

After the 2010 constitution, the law was amended such that an MP who serves for at least two terms automatically qualifies for a contributory pension.

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

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

SRC, while opposing the Bill, said that increasing the pension of the former MPs will put pressure on the wage bill, “which is a big problem for the economy given the government’s goal of cutting recurring expenses to reduce the rising debt load.”

At the time, SRC also noted that implementing the proposal may elicit similar demands from other public officials- retired judges, permanent secretaries, and former top civil servants who, due to their previously low salaries, get very modest pension packages.

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

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

One of its recommendations to the PSC was that the 500 former MPs at the time, be paid 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 the former MPs who served between 1963 and 1983 to cater for all the legislators who served the country at the national level.

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

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