Margaret Nyakang’o, Controller of Budget, is demanding that all withdrawals from the proposed Judges’ Retirement Benefits Fund require the approval of her office to prevent 'fiscal abuse'.
A Parliamentary committee and the Office of the Controller of Budget (OCoB) have disagreed over how withdrawals from the proposed Judges’ Retirement Benefits Fund should be made.
The disagreements are centred on the Judges' Retirement Benefits Bill 2025, currently before the National Assembly, which seeks to establish a fund into which all pension contributions by the judicial officers would be made and managed by a board of trustees.
The core dispute
According to the proposed law, pension for the judges will be paid from the Judges’ Retirement Benefits Fund, where they will contribute 7.5 percent of their pay while in active service. The government, as the employer, will pay into the fund 15 percent of each judge's pensionable pay. This contribution will be directly charged to the Consolidated Fund.
In a clash on the impending law, the Controller of Budget (CoB) Margaret Nyakang’o wants the Bill amended to provide that all withdrawals from the fund be made with the approval of her office.
“The Office of the Controller of Budget proposes insertion of a sub-clause to provide for the fund’s disbursement to be subjected to approval by the Controller of Budget in accordance with the constitution,” says Dr Nyakang’o.
Controller of Budget Margaret Nyakango at a past event.
The CoB adds, “This is to ensure oversight over public fund withdrawals and prevent fiscal abuse or bypassing of lawful expenditure controls.”
Article 228 (4) of the Constitution states that the CoB shall oversee the implementation of the budgets of the national and county governments by authorising withdrawals from public funds- Equalisation Fund, Consolidated Fund, and County Revenue Funds.
The constitution goes on to state that the Controller of Budget shall not approve any withdrawal from a public fund unless satisfied that the withdrawal is authorised by law.
The Justice and Legal Affairs Committee of the National Assembly(JLAC) is, however, of a different opinion, saying that approval of the CoB is not mandatory.
The committee, chaired by Tharaka MP Gitonga Murugara, observed that the CoB is "only constitutionally mandated to authorize withdrawals from the Consolidated Fund and other specific funds.”
“The withdrawal from the judge’s retirement benefits fund does not require authorization from the Office of the Controller of Budget,” JLAC says in a report on the consideration of the Bill.
The CoB also proposed the need for a detailed governance framework, including investment rules, fiduciary duties, and reporting standards, “in compliance with Public Finance Management (PFM) Regulations to enhance transparency and oversight.”
Constitutional interpretations
The CoB further wants the provision of quarterly reports of all transactions relating to the funds to the Office of the Auditor-General in accordance with the Retirement Benefits Act included in the Bill.
National Assembly Majority Leader Kimani Ichung’wah
The Bill, sponsored by the Leader of the Majority in the National Assembly, Kimani Ichung’wah (Kikuyu), seeks to establish a dedicated pension framework for judges of superior courts, providing for annual pension adjustments pegged to five percent.
Article 162 (1) of the Constitution identifies superior courts as the Supreme Court, Court of Appeal, High Court, and the courts established by parliament with the status of the High Court to hear and determine disputes relating to employment and labour relations and the environment.
The memorandum and objects of reasons of the Bill state that it has been in development since the late 1990s and “marks a significant step towards realizing the principles of the Constitution in respect of the Judiciary, its independence and the remuneration and benefits of judges of superior courts.”
The Bill is guided by Article 160 (4) of the Constitution, which requires that any pension reforms that affect judges should not vary the remuneration and benefits payable to a judge to their disadvantage.
The constitution, therefore, requires judges who are in a defined benefits scheme “to remain in such a scheme or for the components of a scheme to be enhanced.”
Broadening judicial perks
The retirement benefits for the judges are currently prescribed under the Pensions Act, which came into operation on January 1, 1946, and provides for a defined benefit pension plan where the government undertakes to pay a specific pre-determined benefit to a judge upon retirement.”
By enhancing the retirement packages, including pension, post-retirement transport benefit, and the post-retirement medical benefit, the Bill gives preferential treatment to the retired judges of the superior court over other public servants who are not entitled to similar inflation-adjusted benefits.
Under the proposed framework, judges will contribute 7.5 percent of their salaries during service, with the government contributing 15 percent of each judge’s pensionable pay with contributions charged directly to the Consolidated Fund (CF).
This means that pensions will be paid from a proposed judges’ retirement benefits fund if the Bill becomes an Act of Parliament.
According to Article 260 of the Constitution, Judges of the superior courts are State Officers, just like the President, his deputy, and members of the cabinet, the Chief Justice and his deputy, MPs, chairpersons and members of constitutional commissions, and holders of independent offices, such as the Auditor-General and Controller of Budget.
The others are county governors, Principal Secretaries, Magistrates, MCAs, Director of Public Prosecutions, the Chief of the Kenya Defence Forces (CDF) and service commanders, Director-General of the National Intelligence Service (NIS), and the Inspector-General and Deputy Inspectors-General of police.
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