Pay burden rises as leaders get pension, salaries same time

Members of Parliament take the oath of office at the National Assembly

MPs take the oath of office at the National Assembly on September 8, 2022. An MP who has served for one term is entitled to a Sh5.8 million send-off package while those who have served for at least two terms are entitled to a Sh7.8 million send-off package on top of Sh127, 000 monthly lifetime stipend.

Photo credit: Jeff Angote | Nation Media Group

What you need to know:

  • An MP who has served for one term is entitled to a Sh5.8 million send-off package.
  • Those who have served for at least two terms are entitled to a Sh7.8 million send-off package on top of Sh127, 000 monthly lifetime stipend.
  • The monthly package for members who have served for three years is capped at Sh191,000 in addition to the one-off payment of Sh7.8 million.

The taxpayer is set to spend additional millions of shillings to sustain the flashy lifestyles of a growing list of politicians who get double payments in hefty pensions and salaries.

The August 9 elections have added more names to this category of high-profile individuals who take up public service jobs after losing their political seats thereby setting themselves to benefit from both pensions, salaries and allowances at the expense of the taxpayers.

Former lawmakers elected as governors or set to serve as Cabinet secretaries (CS) and principal secretaries, among other roles in the new administration, are set to receive their pension from the Parliamentary Pensions Scheme on top of their new salaries and allowances running into millions of shillings.

According to the Parliamentary Service Scheme, an MP who has served for one term is entitled to a Sh5.8 million send-off package while those who have served for at least two terms are entitled to a Sh7.8 million send-off package on top of Sh127, 000 monthly lifetime stipend.

The monthly package for members who have served for three years is capped at Sh191,000 in addition to the one-off payment of Sh7.8 million.

Governors James Orengo (Siaya), Gladys Wanga (Homa Bay), Abdulswamad Nassir (Mombasa), Irungu Kang’ata and Kimani wa Matangi (Kiambu) are some of the new entrants to this category.

They won the governor seats after serving for at least two terms as MPs. This means they are entitled to a lifetime pension package from the parliamentary scheme, which they will be receiving monthly on top of their Sh924,000 monthly pay as governors.

CS nominees perks

Cabinet Secretary nominees Moses Kuria, Kipchumba Murkomen, Aden Duale and Alice Wahome are also entitled to the pension that they will get on top of their new salaries should they be approved to join the Cabinet.

They will be receiving the stipend on top of their monthly pay of Sh924,000 payable to Cabinet secretaries.

The number of new entrants to this category of politicians is set to shoot as more poll losers who have served for at least two terms are set to be handed state jobs, including the controversial Chief Administrative Secretaries (CAS), ambassadorial and parastatal heads.

Of the 337 elected MPs in the last parliament, (290 constituencies and 47 Woman Rep), only 193 made a comeback to the current National Assembly. About 144 are entitled to either a one-off payment or a lifetime stipend depending on how many terms they served as MPs.

In the Senate, only 17 senators were re-elected, implying that the rest will have to get millions of shillings from the taxpayers as an exit package. Most of them will end up taking new public jobs under new terms of service.

While appearing for vetting, former National Assembly Speaker Justin Muturi, nominated to be Attorney-General, told the Committee on Appointments that one of his revenue streams is pension.

"I have been a very modest public servant and my net worth is currently estimated at just about Sh700 million….currently from my activities as a farmer and through consultancies that I do from time to time. I get occasional rewards. Otherwise, I am now a pensioner," said Mr Muturi.

Former governors Salim Mvurya (Kwale) and Jackson Mandago (Uasin Gishu) are set to withdraw gratuity running into millions of shillings for serving as county bosses for 10 years.

This is even as Mr Mvurya settled for salaries in his new role as a CS upon approval and Mr Mandago as a senator.

“It is the provision in the law and it is a burden to the taxpayers. It is an entitlement which needs to be reviewed,” says governance expert Javas Bigambo.

“It may be important for Parliament to review the provision to provide that retirement means retirement. These are things that we need novel thinking in the law,” he adds.

Article 77 (3) of the constitution states that “a retired state officer who is receiving a pension from public funds shall not hold more than two concurrent remunerative positions as chairperson, director or employee of a company owned or controlled by the state; or a state organ”.

Salaries and Remuneration Commission (SRC) chairperson Lyn Mengich told the Sunday Nation that the provision was made to restrain public officers from engaging in multiple gainful employment.

Ms Mengich says that the Parliamentary Pension Scheme is unique since it is a contributory scheme where members are deducted a certain percentage of their salaries to the scheme.

“Most pension schemes don’t allow their members to receive the pension when they are still in active employment,” says Ms Mengich.

“I would not want to speak much about the MPs' pension scheme because each pension scheme sets up its own rule. It would be speculative for me to talk about their scheme,” she explains.

ODM nominated MP John Mbadi, who is doing his fourth term, says pension is an entitlement that is extended to other cadres of employees.

Mr Mbadi says even teachers who retire from the Teachers Service Commission (TSC) to join politics are paid their pension by the teachers’ employer even as they get new pay from the Parliamentary Service Commission (PSC).

He explains that MPs are deducted from their salaries an amount that is matched by the employer for the scheme.

Monthly deductions

Lawmakers are deducted 12.6 per cent of their salaries for remittance to the scheme every month.

“The issue of pension of MPs is not unique because even those serving in the positions are entitled to the money. Pension is not a benefit but your savings. There is nothing in the law that disqualifies one from getting their pension even after they take up other jobs. In fact, you can get two pensions,” explains Mr Mbadi.

Lawyer Danstan Omari says it is within the MPs’ right to get their pension even when they have taken other state jobs.

He argues that the pension is for the work already done and when taking up another role it is under new terms of engagement.

“Nothing can stop them from getting what they are entitled to. It is the law and it will remain as such. Saying it is not right appears discriminatory to the state officers. Everyone is entitled to what they have worked for,” says Mr Omari. “They are eligible for pension …It is a pension already earned from the previous contract. So they will continue drawing their pension as provided for under Article 77 (3). This is only applicable to MPs. Governors are only entitled to gratuity,” explains Mr Omari.

Constitutional lawyer Bobby Mkangi says the law provides for the benefits. He, however, says the same law should give clarification on what “retirement means”.

“Since the law provides for it, there is nothing that can stop them from benefiting. I know of the one-off payments. The lifetime one for MPs sounds imprudent if they have just left the office for another job,” says Mr Mkangi.

“If somebody came from a private service to the public, they are entitled to get their benefits but it sounds odd when you move from one job to another within the public sector and demand for pension when still in active employment. It makes one look greedy,” he argues.

Double payment burden

The double payment burden is on top of the retirement benefits of former presidents, ex-Prime Minister Raila Odinga and retired vice-presidents, including Kalonzo Musyoka, Moody Awuori and Musalia Mudavadi.

Mr Odinga, Mr Musyoka and Mr Mudavadi are beneficiaries of the Retirement Benefits (Deputy President and Designated State Officers) Act enacted by Parliament in 2015.

Former President Uhuru Kenyatta had initially declined to approve the retirement package for Mr Odinga demanding that he retires from active politics.

He, however, abandoned this position to allow the then-opposition leaders to access their benefits following the March 2018 handshake.

According to the Act, Mr Odinga is entitled to a monthly pension equivalent to 80 per cent of his last salary, a lump sum equivalent to 12 months of his last pay, security, medical insurance and a diplomatic passport for himself and his spouse.

He is also entitled to two saloon cars and a four-wheel drive vehicle, both of which come with three drivers and a fuel allowance equivalent to 15 per cent of the monthly pay of the serving deputy president.

The perks have been a subject of controversy as they have been used by political opponents to demand their retirement from active politics.

The argument has been that the perks should be advanced to politicians who are no longer in active politics.

In the run-up to the August 9 polls, Thirdway Alliance Kenya party leader Ekuru Aukot went to court seeking to block Mr Odinga, Mr Musyoka and Mr Mudavadi from participating in the polls on the basis that they were benefiting from a retirement package.

"The Act recognises the entitled persons and grants them both a generous retirement package and an obligation to serve as advisors to the government and the people of Kenya. The advisory role as stipulated under section 8 of the Act is not optional and the relevant persons are obligated to serve as advisors throughout their lifetime. This privilege is not available even to career civil servants," stated the petition.

The petition was dismissed by the High Court.