Former MPs set to get Sh100,000 monthly for life

Taxpayers will fork out Sh450 million annually as pension for former MPs who retired between 1984 and 2001, if a Bill sponsored by Minority Leader John Mbadi is passed into law.

The 375 MPs will each get an increase in their pension payout to a minimum Sh100,000 per month for life.

“A former Member of Parliament, who having served in Parliament between July 1, 1984 and January 1, 2001 and is entitled to pension under this section and whose monthly pension amounts to less than one hundred thousand shillings shall be entitled to a monthly pension of one hundred thousand shillings,” the Parliamentary Pensions (Amendment) Bill, 2019 reads.

Mr Mbadi is seeking to amend the Parliamentary Pensions Act, Cap 196, to raise the amount of pension due to former MPs, a move that is likely to further infuriate taxpayers given that sitting MPs have already signalled that they want to be paid an additional 17 allowances.

The Parliamentary Pensions Act stipulates that only those who serve for two terms or more are entitled to a monthly pension of at least Sh125,000 for the rest of their lives. That means an MP who served for four terms between 1992 and 2013 for instance earns a monthly pension of about Sh194,000.

Now, Mr Mbadi wants even those who have served one term to benefit.

"This is in light of the fact that despite serving the nation, some Members of Parliament are languishing in poverty and there is need to take care of their welfare," he says in the memorandum of object and reason to the Bill.

The Suba MP said the changes are in line with recommendations of the Akiwumi Tribunal that was appointed in January 2009 by the Parliamentary Service Commission (PSC) to review the terms and conditions of service for members and employees of Parliament.

The tribunal submitted its report on November 12, 2009 and recommended in one of its findings that the 570 MPs be paid an equivalent of Sh100,000 ($1,000) each as living pension with effect from July 1, 2010.

The number of beneficiaries has since reduced from 570 to about 375, Mr Mbadi says in the Bill.

The PSC adopted the Akiwumi Tribunal report in June 2010 and resolved that any of the former MPs earning a pension of less than Sh100,000 be paid a mininum of Sh100,000. MPs who serve two terms or more are entitled to pension of Sh100,000 while one-term MPs are entitled to service gratuity and refund of their pension contributions.

Lawmakers are deducted 12.75 percent of their monthly salary for their pension, which is matched by the State.

The law provides that those who have served for less than two terms get a refund of their contribution and annual interest of 15 percent.

Mr Mbadi said the Budget and Appropriations Committee had agreed that payments to the beneficiaries should not be backdated to July 1, 2010, as recommended by the Akiwumi Tribunal.

"I had recommended backdating of this payments in my initial draft Bill, but after consulting with BAC, we decided that it would be a burden on the taxpayer. So, the payment will begin at the point the Bill is assented to and becomes law," Mr Mbadi said.

The Parliamentary Pensions Act stipulates that a former MP can only access pension if he or she ceases to be a member of the National Assembly by reason of dissolution of Parliament, if his or her aggregate period reckonable service is two terms of Parliament and has attained the age of 45 years.