Suffering retirees: 'I had to pay an agent to get my pension'
What you need to know:
- Retirees in Kenya face challenges in accessing their pensions, often involving lengthy delays, bureaucratic hurdles, and potential underpayment.
- Edna, a retiree with 12 grandchildren under her care has encountered a tedious and difficult process following up on her pension.
In 2018, Edna* received a letter from the Ministry of Health informing her that she was just one year away from her retirement from her nursing job at a county referral hospital in Western Kenya.
Before the transfer to the county in 2016, Edna had worked at Kenyatta National Hospital, a public referral hospital in Kenya, for 31 years.
“I quickly filled the documents. Part of the documentation is clearance with Kenya Revenue Authority and the county. Thereafter, I submitted the documents to the Ministry of Health, specifically the department in charge of processing pension to forward them to the Treasury,” she says.
“I was hopeful of receiving my pension in the last month of working, or at least the first month of my retirement.”
Shock on her. She retired in May 2019, at 60 years, the age at which public servants retire except for those with disabilities whose term is extended to 65 years.
However, academic and scientific staff at universities, colleges and research institutions may retire at 65 years of age. Nevertheless, the Cabinet Secretary responsible for matters of human resources may adjust the retirement agefor public servants with the approval of the Cabinet.
The rounds she made between the Ministry of Health and Treasury was like a whirlwind in the Sahara Desert.
“I’d go to the Health ministry; they tell me the documents have been forwarded to the Pensions Department at the Treasury. Then the Treasury would send me back to the Health ministry to retrieve my documents. The back and forth was too stressful. Imagine travelling from Busia to Nairobi from time to time all the while thinking about your grandchildren. It’s too much,” she confesses.
She has 12 grandchildren under her care. After a whole year of being taken in circles, Edna was desperate.
Weary and in dire need of the pension, she fell prey to so-called “agents”.
“A friend who had retired from the Kenya Airforce introduced me to someone at the Treasury who offered to help.”
That assistance came with a huge cost.
Read: Save retirees from agony
“To fast-track the processing of my documents, he told me to pay Sh50,000, which I did and after four months, I had my pension in lump sum and started receiving the monthly payouts.”
As of July 1, 2024, the pensions department had not responded to her queries, which included the “agents” intervening for her.
By failing to process Edna’s pension in time, the public servants in the respective offices, violated not just the domestic laws on pensions but also the global guidelines on the scheme by the International Labour Organisation (ILO).
ILO requires countries to adopt a good practice of prompt payment of pension, to maintain the purchasing power of the pensioners and save them from poverty, vulnerability and social exclusion.
Section 16A of the Pensions Act gives civil servants the power not to vacate office until their pension is fully processed and paid.
It says, “A person to whom a pension or other allowance is payable under this Act shall be entitled to be retained in the service until the payment in full of the gratuity payable to him consequent upon the exercise by him of his option to receive such gratuity.”
While Edna is among 200,000 pensioners in the country, based on 2019 data from the Treasury, the figures are not dis-aggregated, according to gender. But this number is set to increase as more than 85,000 public servants are set to retire in the next three financial years.
Cumulatively, according to the 2013 study by the Public Service Commission, most of the civil servants are men at 62 per cent compared to 38 per cent of women.
The underrepresentation of women in the civil service implies that more men than women are likely to retire.
This rise in pension numbers is projected in the Public Administration and International Relations Sector Report (2023) where the Pensions Department sets a target of processing 18,761 claims in the financial year 2021/22 but ends the period with 27,256 completed claims.
For the 2022/23 financial year, it planned to process 28,422 but finished the year with only 18,640 finalised applications.
“The drop in the number of files processed in 2022/23 was due to lack of exchequer to pay claims,” the department says in the report.
In the two financial years, the department took four days to review, process, and approve or decline pensions and gratuity files, it indicates in the report.
Retirees say the biggest obstacle to access to pension is the parent ministries, departments and agencies from where they initiate the pension process.
“You’ll find the file never left the ministry to the Treasury, yet you will be told it has been forwarded,” says Benson Ambuni, national chairman of Retirees Benefits and Claims Welfare Association of Kenya.
“And they don’t communicate if the file was returned for corrections or if some documents are missing. They don’t have a heart for retirees, yet some are sickly,” decries Benson.
In a 2022report on a survey of pensioners and retirees by the Retirements Benefits Authority (RBA), 55 per cent of the retirees reported a smooth access to their pensions.
Of those who faced challenges, 15 per cent said the pension was delayed while 12 per cent reported unpaid benefits due to underpayment.
Five per cent reported being hit by poor communication or lack of information from their respective pension schemes, and four per cent of the sampled retiree said they were unaware of the benefits calculation.
Out of these challenges, Temmy*, a retired civil engineer, has faced three. Between 1982 and 2021, when she retired, she worked in two defunct local authorities in Central Kenya, which transitioned to counties in 2013.
At the time, the authorities had a pension scheme. She filed for her pension a year before her retirement. She was promised to receive her lump sum a month after retiring.
But the payment was delayed and no one called her to inform her of the status of her pension payment.
“Four months after making frequent follow-ups, I finally got my lump sum but it was 15 years less. I demanded to be shown how the calculation was done but the officers have refused to cooperate. It’s too stressful,” she complains.
In 2023, National Treasury and Economic Planning Cabinet Secretary Njuguna Ndung’u pointed out this failure of the counties to dutifully pay retired workers their pension.
“Most of the county governments owe money to the various pension funds (Laptrust, Lapfund and County Pension Fund), which have accumulated over the years. Some county governments are not reflecting these pension liabilities in their pending bills stock, hence posing a great risk that these liabilities may not be prioritised for payment,” Prof Ndung’u notes in the 2023 budget policy statement.
Experts warn against ineffective pension services, saying they drag the country’s socioeconomic growth.
“Pensioners in countries where the pension system is seamless, enjoy a healthy life and the benefits of this healthy life are felt by their families who don’t have to struggle to take care of them,” states Dr Gloria Langat, head of the Aging and Development at the African Population and Health Research Centre.
Considering the pensioners struggles to rightfully access their pension, stakeholders recommend devolving the pensions department services and digitising the process 1982, 2021.
“In countries with comprehensive and mature systems of social protection, with ageing populations, the main challenge is to maintain a sound balance between financial sustainability and pension adequacy,” notes International Labour Organisation in its brief on social protection for older women and men.
“At the other extreme, many countries around the world are still struggling to extend and finance their pension systems; these countries face structural barriers linked to low levels of economic development, high levels of informality, low contributory capacity, poverty and insufficient fiscal space, among others,” it further highlights.
Global Pension Transparency Benchmark ranks Canada first among countries with the best pension scheme for retirees. Here, monthly payment increases in January of each year when there’s an increase in the cost of living, unlike in Kenya where pension can only be raised at the discretion of the cabinet secretary responsible for pension.
Dr Gloria says the government ought to “seriously” safeguard pension and streamline all processes of accessing it to save the retirees from the trauma of years of waiting for the lump sum and payouts.
“Let the government establish pension offices in the counties. Why should an older person be forced to travel all the way from Mombasa or Marsabit to Nairobi to move from one office to another to follow up on their pension?” queries Lydia Makena Micheni, a programmes officer at HelpAge International, a global network of older persons’ organisations.
The network helps older people claim their rights, challenge discrimination, and overcome poverty. The retirees, however, have a voice through the RBA as it can seek redress of their grievances once they file their complaints.
RBA regulates, supervises as well as promotes development of the retirement benefits sector.
“We always advise members to file complaints or use the whistle-blower portal for sensitive issues: http://portal.rba.go.ke/whistleblower/. No Kenyan should be denied access to their rightful benefits,” says James Ratemo, the head of corporate communication at RBA.
He says all schemes registered and regulated by RBA are required to release retirement benefits, when due, within 30 days as per the Retirement Benefits Act (No. 3 of 1997).
For now, the welfare association has come to the rescue of the retirees. It was registered in 2023 to end the pensioners’ tribulations. It seeks to bring together up to 400,000 retirees. So far it has recorded 60 cases, 24 of which are from women.
“I’m happy to report that out the 60 cases, 36 have been solved and the retirees have received their pensions,” says Benson.
There are, however, retirees who never struggled to get their pension. I spoke to two men who retired from the Central Bank of Kenya and they said they received their lump sum in the last month of their service and their payouts began, the first month following their retirement.
In the mix of the bad and good experiences, lies hope for the retirees.
“I strongly believe that soon things will change for the pensioners because we now have an association that speaks for us, and leaders in the respective ministries have been receptive. They have taken action on the claims raised by the retirees,” says Edna who has since joined the retirees’ association.
*The names have been changed to protect the privacy of the pensioners.
