Pyrethrum firm retirees to wait longer for Sh2bn pension arrears

As the financial crisis at the Pyrethrum Processing Company of Kenya (PPCK) deepens by the day, the state agency is yet to pay more than 300 pensioners their outstanding dues amounting to more than Sh2.3billion.

The Pyrethrum Board of Kenya Staff Superannuation Scheme fell into financial problems nearly a decade ago due to mismanagement.

Since 2012, members of the scheme, who have been leaving the company due to retirement or natural attrition, have not been paid their dues.

The Retirement Benefits Authority (RBA) moved to court and filed a petition. After four years, the court ruled that the scheme should be wound up and liquidation of assets carried out to avail funds to pay pensioners.

The official government receiver through the Attorney-General was appointed to execute the orders in May 2017.

However, the liquidation process has stalled even as the cash strapped PPCK continues to cling to underutilised land assets worth Sh4 billion that could be disposed of and save the suffering pensioners from further agony.

More than 40 pensioners have died and dozens of others are admitted in various hospitals across the country.

"I suffered a stroke two years ago and I have been bedridden and confined to my house. I'm now living a miserable and painful life, yet I worked so hard during my youthful days at the defunct Pyrethrum Board of Kenya. I saved money that I thought would help me enjoy my retirement in peace," said Mr Robinson Kuria.

Ms Annabel Ng'endo, a former worker is also suffering a similar fate.

"I'm suffering from arthritis and I underwent a hip operation. I have exhausted all my meagre resources as I wait from my pension dues. As senior citizens, who worked hard and helped the country earn billions of shillings in foreign exchange, we deserve better treatment and I urge the government to address our plight," said Ms Ngendo.

PPCK owns prime properties including the 865 acres of land in Oljorook in Nyandarua County and houses in up-market Milimani Estate and other parts of Nakuru Town.

The company has commercial buildings in Nairobi and massive go-downs in Nakuru town and land in Olenguruone, Kisii, Bomet, Meru, and Bungoma among other counties.

The company also owes statutory organisation millions of shillings that have not been remitted for years

PPCK jointly owns these properties spread in all the 18 pyrethrum growing counties across the country with Agricultural Food Authority (AFA).

According to the acting managing director of PPCK, Joseph Waweru, the company is unable to sell its assets because it has no board.

"The decision to sell the buildings are made at a high level," said Mr Waweru.

But the pensioners' spokesperson refuted the claims by Mr Waweru.

"The MD is not being honest with himself as the company wrote the letter to dispose of the assets which were approved by the Treasury," said Mr Harun Tinga, the pensioners' spokesperson.

He added: "When the current PPCK acting MD was working at AFA he wrote to the Treasury and gave out two options including selling the assets or additional funding and as pensioners, we are surprised he has made a U-turn on his earlier letter asking the government to allow PPCK to dispose of the properties."

The Treasury responded and gave an advisory opinion arguing that there is no point of pumping in more money to PPCK when it has non-core assets which could be sold and directed the PPCK to dispose of some of its assets to specifically clear the pensioners' dues.

However, in a twist of events, AFA which jointly owns the assets with PPCK urged the Treasury to reconsider its position and if possible allocate funds to enable the authority to run its activities.

AFA boss Antony Muriithi said liquidating assets of the former PBK to boost PPCK financial bases may disrupt government efforts to revive the ailing company.

"Liquidating assets of the former PBK to meet these obligations may hamper the revitalisation strategy for pyrethrum which the government is currently pursuing to lift the giant processor out of its financial challenges," said Mr Muriithi in a letter to Permanent Secretary Agriculture Prof Hamadi Boga on June 25.

"Selling non-core assets do not need a board and will not disrupt the revival of the ailing sector. PPCK is leasing the houses through Bonkam Ventures without a board. This excuse by the MD and AFA does not hold water and is meant to frustrate poor pensioners and farmers," argued Mr Tinga.

"Owning these houses is not the main business of the PPCK and hence the need to sell them as per the government directive," added Mr Tinga.

A senior official at the Ministry of Agriculture said that the government is not keen on appointing a board as PPCK is not financially stable and some of the areas where the cash crop is grown is still dragging behind and farmers need to elect some of the board members.

"This year the government has injected Sh70million more to jumpstart the revival process," said Mr Waweru.

The government also has appointed a pyrethrum revitalisation committee.

One of President Uhuru Kenyatta's promise to pyrethrum farmers in the country is the revive the sector and give Nakuru factory which is outdated as it was installed in 1936 anew lease of life.

"These machines are so old such that when you crash 100 metric tonnes of dry flowers you lose 40 per cent and this is a big loss to the company," said a worker at the Nakuru factory.

In 2012 the Cabinet approved the sale of the non-core assets but the move has never been implemented.

Previous attempts to liquidate the assets of the now-defunct Pyrethrum Board of Kenya have faced several legal technicalities relating to the ownership which is in farmers and lack of Board to facilitate the process.

Besides, former PBK is encumbered by several legal cases which have put a caveat on several properties that may be useful in offsetting such a liability.

But even as PPCK cling to the houses, some of them are in bad shape and need massive renovations to generate income for the company.

Some prime houses along Moses Mudavadi Road in Nakuru's Central Business District have been condemned by the National Environment Management Authority (Nema).

However, some of the pensioners say although the houses are old they could be renovated and leased out and earn PPCK good money at current market price.

"As pensioners, we are also suspicious on the way the houses were condemned and it might be a ploy to sell the houses at a throwaway price," said Mr Tinga.

However, Mr Waweru denied the claims by pensioners that the houses will be sold.

Pyrethrum Growers Association national chairperson Justus Mochache Monda urged President Kenyatta to personally intervene and save the farmers from further agony.

"The revival song has been here with us for more than a decade now with little success and I urge President Kenyatta to intervene as pyrethrum is critical in the success of his Big Four Agenda," said Mr Monda.

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