RBA chief executive Nzomo Mutuku said the universities would cede the properties if they lack funds to clear the arrears.
Six public universities risk losing assets such as land and homes to pension schemes after they failed to remit deductions estimated at Sh5 billion to build workers' retirement funds.
Retirement Benefits Authority (RBA) chief executive Nzomo Mutuku said the universities would cede the properties if they lack funds to clear the arrears.
Universities cash flows have been hit hard after lower entry grade cut student population, adversely affecting the lucrative parallel degree courses in which students paid fees based on market rates.
This has prompted many to delay statutory deductions such as pension, which will see thousands of retirees take home smaller retirement benefits as they miss out on the investment incomes.
The RBA reckons it has opened talks with vice chancellors of the unnamed universities to work on a remedial plan to clear the arrears estimated at Sh5 billion.
“In the remedial plan, they may either transfer assets like land and buildings to the scheme if they don’t have cash or commit to pay certain amounts of money per month until they clear the arrears,” said Mr Mutuku.
“This challenge came, especially during the period that there was a long strike and there was no learning going on and therefore no revenue coming in.”
He told the Business Daily that the arrears must be cleared within six years, which is the maximum period allowed in law.
In October last year, the RBA put into use the amendments to the RBA Act in which employers face a penalty of five percent of the unremitted contributions or Sh20,000, whichever is higher.
Data from the Education ministry show that universities failed to remit Sh4.58 billion to the pension scheme as at June 2017.
University of Nairobi had arrears of Sh1.3 billion while Jomo Kenyatta University of Science and Technology owed Sh1.09 billion.
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Note: The results are not exact but very close to the actual.
