Rift Valley Railways headquarters in Nairobi. The property rich scheme
has been relying on rental income and sale of assets both of which have
been challenged in court numerous times, sinking it into heavy debt and
arrears. PHOTO | FILE
By EDWIN OKOTH, edokoth@ke.nationmedia.com
In Summary
- The AGM was called off after the retirees staged a noisy protest accusing managers of the Sh31 billion pension fund of mismanagement.
- The scheme’s troubles lie in the fact that while it is rich in real estate assets (valued at about Sh30 billion), it all remains illiquid and monthly rent collections from its holdings do not match its monthly obligations to the retirees.
- Attempts to sell some of the assets have meanwhile been stalled by litigation in the courts.
The 8,000 member Kenya Railways Staff Retirement
Benefit Scheme annual general meeting aborted yesterday as the
long-running battle between the retirees and fund managers came to
ahead.
The meeting was called off after the retirees staged a noisy
protest accusing managers of the Sh31 billion pension fund of
mismanagement.
The AGM, which had earlier been postponed, failed
to kick off as members shouted down a representative from the Retirement
Benefits Authority demanding the removal of the corporate trustee and
the scheme’s chief executive officer. The last AGM was held in 2014.
“We’re not going to allow any further fleecing by
these trustees and it is time we take control of our assets. We were
given a cow by our sponsor but if those we entrusted to take care of it
cannot give us milk, then let us take our cow back. We the poorest
billionaires in town,” said Aggrey Simiyu, a former senior Kenya
Railways manager.
The retiree who is now a member of a steering
committee driving the new approach to manage the multi-billion shilling
pension wealth said they had planned to propose the formation of a
Railway Pension Management Company run by the pensioners to salvage the
struggling scheme.
The scheme’s troubles however lie in the fact that
while it is rich in real estate assets (valued at about Sh30 billion) it
all remains illiquid and monthly rent collections from its holdings do
not match its monthly obligations to the retirees.
Attempts to sell some of the assets have meanwhile been stalled by litigation in the courts.
Some retirees under the umbrella of the Kenya
Railway Pensioners Association had written to the Retirement Benefits
Authority Chief Executive Edward Odundo seeking to kick out both the
Corporate Trustees (Corporate and Pension Trust Services Limited) and
the Chief Executive Officer Simon Nyakundi.
Mr Nyakundi said a fresh attempt will be made to
hold another AGM but could not tell the timeframe as he was waiting for
guidance from the Trustees.
‘We have written to both the regulator (RBA)and the
sponsor (Kenya Railways Corporation)because this was an abnormal
occurrence. Once a response is relayed to us through the corporate
trustees then we will know the way forward We will still have to hold
the AGM though, I can’t tell you when,” Mr Nyakundi said.
The pensioners who had turned in large numbers from
across the country left railway club a dejected lot after the meeting
ended even before it had started.
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