MPs in fresh bid for fat pension perks

Through the Parliamentary Pensions (Amendment) Bill, 2023 MPs are seeking that they get benefits even for serving one term or less than a year in Parliament.

The bill sponsored by Kitui Central MP Makali Mulu seeks to grant lawmakers gratuity for the period served, notwithstanding the fact they are below 45 years.

“Subject to the provisions of this Act, a person shall be entitled to receive gratuity where the person ceases to be an MP and has served an aggregate period of five years or less,” the Bill reads.

The Parliamentary Pensions Act says MPs are only entitled to pension after serving two terms and attaining the age of 45 years.

The Bill further recommends members who die before serving 12 months in the office paid their full salary equal to one year’s pay.

“Where a member dies and has not become eligible for a pension, if his reckonable service is less than 12 months, the committee shall pay to his legal personal representative an amount equal to his annual salary,” the Bill reads.

The proponents say the Parliamentary Service Commission has lacked a substantive law to give such ineligible members an exit package.

A member who serves one term or less thus can only ask for a refund of his contributions.

It is also said that the existing law only recognises members of the National Assembly, leaving out senators.

Now MPs want to vest the power of managing their pensions to themselves through the PSC.

Should they have their way, MPs would also take away the power of the National Treasury in managing their retirement perks.

The Bill also seeks to enhance MPs gratuity — for those who opt for it — putting their payout at 31 per cent of their basic salary for the period served.

Presently, those who serve for less than 12 months are refunded their contributions plus interest earned.

In the event of death, the dependents are paid at the said rate, while those with less than 10 years get five times their annual pension.

If approved, MPs who serve for only one term will be entitled to lump sum gratuity or a lifetime monthly pension if the proposed law is enacted.

This is likely to trigger a sharp increase in lifetime welfare and upkeep budget for the more than 400 lawmakers after their retirement.

MPs contribute about Sh2.5 million for pension within a term of five years while taxpayers contribute for them a similar amount.

In the Bill, MPs would decide whether they will be paid gratuity or pension immediately they are elected.

It also seeks to increase the age of beneficiary children to 18 years from the current 16.

Those below 21 years and are in school would be entitled to a medical cover, regardless of their marital status.

In the proposed law, MPs who leave Parliament on grounds of ill-health would be paid pension even if they are yet to hit 45 years.

This means they would be entitled to Sh125,000 monthly.

MPs also seek to remove the role of the Salaries and Remuneration Commission from determining their pension.

In the new plan, PSC would make regulations and laws governing the pension scheme.

“The administration of this Act shall be by the commission…The payment of pension, gratuity, refund of contributions, and other allowances shall be provided for in the estimates of the commission,” the Bill reads.

MPs are further pushing for the creation of a voluntary post-retirement medial scheme to fund medical care for contributors.

Since 2016, MPs have made attempts to award themselves hefty perks, efforts which President Uhuru Kenyatta vetoed three times.

The current proposal is likely to put MPs at loggerheads with SRC yet again.

The Senate, towards the end of the 12th Parliament, shot down a bill with similar proposals, saying there was no concurrence.  

In the Bill, the Attorney General, Treasury Principal Secretary and other Treasury representatives have been kicked out of the pension committee.

The team is slated to comprise the National Assembly Speaker as the chairperson, the Speaker of the Senate, four members of the National Assembly, two senators and the clerks of the respective Houses.