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Proposed waiver of tax on old age drugs supported

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Poor health sees retirees spend more on special food prescribed by their doctors further dampening the lives. FILE PHOTO | NMG

A wealth management specialist has welcomed the proposed exemption of tax from post-retirement medical cover products saying Kenyans could look forward to a healthy productive life in their sunset years.

Enwealth Financial Services CEO Simon Wafubwa said a tax waiver could entice young working people to enrol for the products, adding that more Kenyans could be lifted from poverty with families being able to meet their daily needs such as food, education and shelter.

Mr Wafubwa spoke in Nairobi when he launched a report dubbed Retirement Wellbeing: A Kenyan Perspective which was jointly prepared by Enswealth and Strathmore University.

The report said only 30per cent of retirees had a comprehensive medical cover, 20 per cent were paying school fees for their children and grandchildren, 20 per cent paid for food while about 15 per cent spent money on an agribusiness venture.

Last June, Treasury secretary Henry Rotich disclosed the government’s intention to amend Retirement Benefits Authority regulations to allow members of pension schemes to use a portion of their benefits on post-retirement medical cover. The survey also revealed that retirees spent up to 25 per cent of their meagre savings on treating lifestyle ailments while up to 20per cent spent on building houses for their families.

“The fact that retirees are using most of their pension on building homes is evident that the pension-backed mortgage policy has not worked out as expected,” he said.

The report urged the government and other stakeholders to address the availability and affordability of healthcare for senior citizens.

Poor health, it noted, sees retirees spend more on special food prescribed by their doctors further dampening the lives.

“Retirees want to leave a legacy and inheritance for their children which has seen many invest their savings in rental housing units that are considered to last forever,” said Thomas Kibua, Director of Programmes at the Institute of Public Policy Strathmore University.

Recent statistics released by the Health ministry show an increase in diabetes, high blood pressure, arthritis, cancer, HIV/Aids, malaria, pneumonia, heart ailments and meningitis in the country.