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Higher NSSF deductions to generate Sh80bn by June
Rise in NSSF contributions and the introduction of a 1.5 per cent housing levy deduction on gross pay from July 2023 have significantly cut workers’ take-home pay.
The National Social Security Fund (NSSF) projects to grow its assets by Sh80 billion over five months to June, lifted by higher deductions from workers starting this month, even as it declared a 17percent interest on savings from the last financial year.
The fund projects that the value of assets under its management would hit Sh750 billion by the end of June, up from Sh670 billion by the end of January 2026.
This projected rise in NSSF assets comes at a time when the payslips of thousands of workers will be raided for additional deductions towards NSSF contributions this month, as the implementation of the NSSF Act, 2013, enters its fourth year.
“We closed the 2024/25 fiscal year with assets valued at Sh575 billion. As of January 2026, we were well past Sh670 billion, and we want to close this year with a fund value of about Sh750 billion by June 30,” said NSSF Chief Executive Officer (CEO) David Koros.
Mr Koros said this during the NSSF’s annual general meeting (AGM) on Friday, where the fund laid out a plan to grow its assets to Sh1 trillion by June 2027, as the final increase on members' contributions is expected in February next year.
Starting this month, NSSF deductions on workers' earnings of more than Sh72,000 will rise from Sh4,320 up to Sh6,480.
This means that six percent of salaries for workers earning up to Sh108,000 will be remitted to the NSSF, as those earning above the amount will surrender Sh6,480 to the fund.
Since the government started implementing the NSSF Act, 2013, three years ago, members' savings have more than doubled from Sh312 billion in June 2023 to Sh670 billion last month.
In the 2024/25 fiscal year alone, total assets under management by the NSSF shot up by Sh173 billion, with new contributions accounting for Sh84 billion, the fund said while releasing its financial results.
The NSSF Board declared a 17 percent interest on investments in members’ savings, noting that the fund recorded Sh105 billion in investment returns, up from Sh41.7 billion the previous year.
NSSF said it has invested in projects, including the Rironi - Mau Summit Road, which guarantees it a 10 percent return in dollar terms for 28 years, and other projects where it is getting returns of up to 15 percent.
“We want to be giving our members double-digit returns. We are diversifying the portfolio, making prudent investment decisions such as the Rironi-Mau Summit Road and the Kenyatta Avenue twin towers 60-storey building that we are developing,” the CEO said.
China Road and Bridge Corporation (CRBC) and NSSF have already started work on the 236-kilometre section from Rironi through Nakuru to Mau Summit. The construction of the Rironi-Mau Summit section is expected to take two years, after which CRBC and NSSF will own and operate the road for 28 years to recoup their investment before handing it back to the State.
At least 3.6 million Kenyans contribute to the NSSF, with about 80,000 employers also matching workers' contributions.
Over the last three years, since the government implemented the NSSF Act, 2013, rising contributions from a flat Sh200 per employee progressively to 6 percent of employees’ salaries, the fund has collected Sh170 billion.
“We are now going to year four of implementing the NSSF Act, 2013, and we are going to move from a contribution of 8,640 to 12,960 at maximum (taking into account equal contributions by employers and employees),” Mr Koros said.
The NSSF management also says it has cleared a backlog of about 300,000 beneficiaries over the past three years, paying them Sh25 billion that had been outstanding.
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