Kisumu: The Kenya County Government Workers Union (KCGWU) has raised concern over the failure by county governments to remit workers’ pension contributions, accusing them of withholding over Sh40 billion meant for the Local Authorities Provident Fund (LAPFUND). Speaking in Kisumu during the 14th LAPFUND Annual General Meeting (AGM), KCGWU National Secretary General Roba Duba revealed that some of the pension arrears date back more than two decades – long before the advent of devolution.
According to Kenya News Agency, Duba stated it was unacceptable and illegal for county governments to deduct pension contributions from workers’ salaries but fail to remit the funds as required by law. ‘This money is supposed to be remitted to LAPFUND to support the scheme’s operations and guarantee growth for the benefit of the members. It is unlawful for county governments to withhold employees’ funds or divert them to other uses,’ he said.
Duba expressed frustration over failed efforts to recover the funds and warned that the outstanding amount was likely to increase due to compounded interest and penalties. He called on Treasury and National Planning Cabinet Secretary John Mbadi, who was the chief guest at the AGM, to urgently intervene. ‘We are not only pursuing the debt but demanding that members’ money be remitted immediately upon deduction by the sponsor,’ Duba asserted.
In response, CS Mbadi acknowledged the seriousness of the matter and announced that a task force formed by his office to investigate pending pension remittances across all schemes had completed its report. He said the findings would be presented to President William Ruto on Wednesday, after which recovery mechanisms would be announced. ‘It is illegal and unconstitutional to withhold workers’ money. Unfortunately, county governments have been the most notorious in this regard. My office is taking this matter very seriously, and we are committed to taking firm action,’ he said.
The CS assured the union that the task force’s recommendations would be fully implemented to ensure pension contributions are remitted on time moving forward. ‘Our ultimate goal is to permanently resolve the issue of delayed remittances to protect the retirement benefits of county government employees,’ he added.
Mbadi further urged the county government workers to remain calm, noting that his ministry would soon convene a meeting with union officials to discuss the Common Bargaining Agreement (CBA), which the workers claim has not been updated since 2012. ‘I will call a meeting with the National Secretary General to discuss this matter. I don’t want to make a pronouncement here today without proper consultations,’ he said.
The CS lauded LAPFUND for safeguarding members’ money and making sound investment decisions to grow the fund. He further challenged other pension schemes and insurance funds to leverage Public Private Partnerships (PPPs) by investing in infrastructure projects to spur economic development and grow the funds. ‘Corruption shall not be tolerated. Members’ contributions must be protected. I want to thank LAPFUND which is domiciled in my ministry for the projects they are undertaking including affordable housing which is plugging into the government’s agenda and creating employment opportunities,’ he said.