Kenyans have reacted in anger to news that MPs made huge budget allocations to fund their retirement after voters kick them out.
The allocations were made despite a standoff relating to whether legislators should be considered for pension, given the nature of their job was contractual.
Nearly Sh1.8 billion has been set aside for the proposed monthly benefits payable in the financial year that starts July, which is seven-fold the Sh247 million collectively paid until now.
That amount is in addition to a planned expenditure of Sh2.85 billion in gratuity for legislators who were not re-elected.
Going forward – and given the high turnover of legislators after every election – the gratuity compensation could be unsustainable.
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In effect, taxpayers are being punished for rejecting their representatives at the ballot.
Ekuru Aukot, the leader of Thirdway Alliance, joined other displeased Kenyans in pointing out that there was no justification for hiked retirement benefits.
“Parliamentarians are not in a permanent and pensionable job. The terms of the contract are strictly five years, and the contract can only be renewed by voters. That makes the job of an MP or Senator different from ordinary civil servants’ jobs,” Aukot said.
Aukot is already pushing for the reduction of parliamentary members to 194 members.
Slashing the number of MPs will sharply reduce the wage bill and, subsequently, the expenditure on pensions and gratuity pay.
A former MP who served for two terms confirmed that he had received gratuity soon after losing in the August polls, and is waiting to attain retirement age to receive the agreed monthly pension of Sh125,000.
The Parliamentary Service Commission deducts 12.5 per cent of legislators’ pay as part of their contribution to a contributory pension scheme, earning 15 per cent interest a year.
Critics say the interest earned on the retirement savings is already too high in a market where the ordinary rate is below 10 per cent.
The last Parliament introduced amendments that granted legislators gratuity as compensation upon leaving office, irrespective of the number of years or terms served.
Previously, a legislator needed to have served at least two terms.
The Salaries and Remuneration Commission approved proposals to calculate the gratuity at 31 per cent of the monthly pay for every year worked, giving rise to the now-controversial compensation.
Jason Lakin, the global head of research at the International Budget Partnership – a pro-governance civil society – said legislators should not qualify for both benefits.
He said it was wrong to duplicate a benefit for legislators who are already the best remunerated class of Kenyans.
Kimani Ichung’wah, who chairs the Budget Committee of the National Assembly, defended legislators, saying the proposed allocations were prepared by a different office.
