RBA to act on employers who withold cash for pension funds

Dr Isaac Mulagoli the chief executive Pyrethrum Board of Kenya. Photo/FILE 

By FRANCIS MUREITHI  fmureithi@ke.nationmedia.com

The pensions regulator has called for an urgent meeting to save the Pyrethrum Board of Kenya Staff Superannuation Scheme from total collapse.

The Retirement Benefit Authority (RBA) has also promised to act against employers who fail to remit money deducted from employees to retirement schemes.

“The board of RBA has called for an urgent meeting to identify a liquidator who will take over the assets of the PBK as it has failed to show commitment to remit money to the pension scheme,” a senior RBA official told the Sunday Nation.

The official, who declined to be named as he is not authorised to speak to the press on behalf of RBA, accused PBK of not being “serious” in securing money for the retirees.

PBK pensioners Mr Thomas Nyambega and Mr Harun Tinga, who attended a meeting with RBA officials. welcomed the new move but termed it “too little too late”.

“This is what RBA should have done long time ago instead of waiting for pensioners to suffer as they watch, yet they are the custodian of the rules and regulations which govern the management of pension schemes in the country,” said Mr Tinga.

During the meeting, it emerged that PBK had submitted a remedial plan, but it was rejected by RBA.

Plan rejected

“The remedial plan submitted by PBK does not add value to the pensioners as per our agreement, and we have therefore rejected it in totality,” said RBA officials.

The official said that PBK, in a memorandum written by the board’s managing director Isaac Mulagoli, had requested RBA to give it up to 2016 to sort out its financial mess.

However, a source told the Sunday Nation that RBA has written to the board indicating its intention to appoint a liquidator to take over some of the assets belonging to PBK and dispose them of to enable the pensioners to be paid their monthly dues without any interruption.

The pensioners had threatened to stage a demonstration outside the RBA offices in Nairobi after the authority appeared to be ignoring the issue.

They cited a case where RBA, in its tribunal ruling of September 26, 2011, ordered PBK to pay the pensioners their delayed pension, but this has not been done.

“RBA has even refused to give us a copy of the ruling so that we could seek intervention from the High Court; this is tantamount to deliberately delaying the wheels of justice,” said Mr Tinga.

But an official of the RBA said the days of employers who have been delaying in remitting pension deductions are numbered.