Governors in fight for county pension cash

The Council of Governors (CoG) has rejected a proposed law that seeks to wrest control of pension schemes in the devolved units terming it as unconstitutional.

The Council told a committee of the Senate during the public hearing that the drafters of the County Governments Retirement Scheme Bill, 2018 had given county governments a peripheral role in the management of the pension scheme, while allowing the national government to take control.

Kisii Governor James Ongwae who chairs the Labour committee of the CoG, told the Senate Committee on Labour the bill also goes against the Retirement Benefits Act (RBA) which dictates that benefit schemes should be set by employers for their employees.

“How can a bill, touching on county employees, give the national government the role of appointing and managing trustees and deliberately placing national players as majority in a scheme that will oversee the retirement benefits of county workers? There is no logic, rationale and policy justification for the national government to arrogate itself such a role,” Mr Ongwae said.

He made his presentation before the Johnson Sakaja-led committee after Labour Cabinet Secretary Ukur Yattani largely supported the bill while giving some recommendations.

Mr Yattani, in his submission, said that since the retirement scheme seeks to largely address issues of social protection, his ministry should be at the forefront in its implementation.

“There’s and oversight. This is not a money bill but social welfare issue. It should not be left to the ministries of Devolution or Treasury. We need a representative from the (Labour) ministry,” said Mr Yattani.

But Mr Ongwae said the bill does not appreciate the respective laws that define the roles and functions of national and county governments.

Section 56 of the bill gives the proposed State Advisory committee the power to oversight the implementation scheme. Mr Ongwae described the proposal as “strange”.

“The way it is drafted is like the bill seeks to make the county retirement scheme look like a state corporation yet it should be a statutory pension trust as required by the Retirement Benefits Act and regulations and should therefore be rejected in its entirety, or be amended heavily in harmony with existing laws,” he said.

However, the County Assemblies Forum (CAF) sharply differed with the governors, saying that it was not the mandate of the CoG to determine the constitutionality of the bill.

“From the onset, it's important to state our position that unlike the CoG, we agree with the bill in its entirety. Its provisions are in line with best practices of public sector scheme and also with RBA in outlining duties, appointment and powers of the board,” said Mr Johnson Osoi, CAF chairman.

The governors and the members of county assemblies however were unanimous in telling off the Labour ministry which they accused of seeking to control the process by pushing to be given the powers to appoint the Chief Executive Officer of the scheme.