NAIROBI, Kenya — Nairobi County is facing renewed pressure to resolve long-standing pension arrears owed to former employees of the defunct Nairobi City Council, following an urgent intervention by the Office of the Ombudsman.
In a statement issued on Monday, December 15, the Ombudsman called on Governor Johnson Sakaja’s administration to urgently address the inherited pension obligations, stressing that the debts remain binding despite the transition from the former city council to the county government.
The Ombudsman emphasised that pension arrears constitute statutory pending bills and must be prioritised within the county’s budgeting and financial planning processes.
It warned that administrative restructuring does not extinguish pension liabilities, noting that such obligations “survive the restructuring of institutions.”
One of the key recommendations was for Nairobi County to undertake a comprehensive joint verification of the outstanding pension debts.
The Ombudsman urged the county to work closely with pension administrators, the Office of the Auditor General, and the National Treasury to ensure accurate reconciliation and transparency in determining the actual amounts owed.
To address the arrears sustainably, the Ombudsman proposed the adoption of a structured, multi-year payment plan. Under the recommendation, the county would clear the debt gradually through a clear and time-bound schedule designed to balance fiscal realities with the rights and welfare of retirees.
Transparency emerged as a central concern in the advisory. The Ombudsman urged the county to provide regular, detailed updates to pensioners on the status of their payments and to publish progress reports through official channels to keep retirees informed and restore public confidence.
The intervention follows persistent complaints from retirees of the Nairobi City Water and Sewerage Company, who allege that pension deductions were not remitted for years. According to the affected retirees, unpaid pension contributions across various schemes exceed Sh4 billion, leaving many struggling financially years after retirement.
The issue has also drawn the attention of Parliament. In November, the Senate Select Committee on County Public Investments and Special Funds (CPISFC) established a Multi-Agency Taskforce to investigate discrepancies between pension debt figures reported by county governments and those submitted by pension scheme administrators.
The taskforce has been mandated to reconcile the outstanding amounts, including principal sums, accrued interest, and penalties, in line with existing legal and regulatory frameworks governing pension schemes. Its work is expected to bring clarity to conflicting figures that have complicated settlement efforts.
In addition, the Senate committee directed the taskforce to develop a payment formula agreed upon by the National Treasury, the Council of Governors, and pension administrators.
The aim is to create a uniform, legally sound approach that enables counties to clear pension arrears while ensuring retirees finally receive their dues.
The Ombudsman’s recommendations now add fresh pressure on Nairobi County, which has repeatedly faced criticism over delayed payments to former employees. For pensioners, many of whom depend entirely on their retirement benefits, the advisory raises expectations of concrete action after years of uncertainty.
As scrutiny intensifies from oversight bodies and Parliament, the county government is expected to outline its response and indicate whether it will adopt the proposed verification and payment framework, potentially setting a precedent for how other counties address inherited pension liabilities.
