NAIROBI, Kenya — National Assembly Finance Committee Chair Kimani Kuria has defended increased National Social Security Fund (NSSF) deductions, arguing that the reforms are necessary to fix decades of pension mismanagement and guarantee retirement security for Kenyan workers.
Speaking during an interview on Inooro FM on Tuesday, Kuria said pension funding challenges did not begin with the current administration but date back to successive governments.
“All previous governments, from Mzee Jomo Kenyatta, Daniel arap Moi, Mwai Kibaki, and even Uhuru Kenyatta, did not remit the government’s pension contributions for civil servants,” he said, adding that the accumulated burden has strained public finances over time.
The leaders he referenced include Jomo Kenyatta, Daniel arap Moi, Mwai Kibaki, and Uhuru Kenyatta.
Kuria noted that in 2024, some retired teachers reported waiting up to six months for pension payments.
He attributed such delays to structural weaknesses in the previous system, where pension payments were budgeted annually and processed through the Consolidated Fund Services account.
According to him, this arrangement meant pension funds were not ring-fenced, creating long-term sustainability risks.
He said recent reforms have separated workers’ deductions and the government’s matching contributions from the Consolidated Fund to protect savings and ensure direct remittance toward pension obligations.
The remarks come amid the phased implementation of the National Social Security Fund Act. Year 3 contribution rates concluded on January 31, ushering in the new Year 4 rates.
Under the updated framework, Tier 1 contributions apply to monthly earnings up to Sh9,000, with both employees and employers contributing 6pc each, translating to Sh540 from each party and Sh1,080 in total.
For earnings above Sh9,000, Tier 2 contributions now apply.
For salaries up to Sh108,000, both the employee and employer contribute Sh5,940 each, for a total of Sh11,880.
Combined with Tier 1, the maximum monthly NSSF contribution per employee now stands at Sh12,960.
Kuria defended the higher deductions by comparing Kenya’s social structure to European welfare systems.
He argued that Kenyan workers often support extended families, increasing financial pressure during retirement.
Strengthening structured savings, he said, would reduce dependency and prevent future pension crises.
Meanwhile, the government is considering further pension reforms that would allow partial access to retirement savings before retirement age.
The proposed model would split pensions into two ‘pots’, one preserved until retirement and another accessible for short-term needs such as medical emergencies, school fees, or business capital.
