September 2020

25Sep

Kenya. Workers can now access pensions to buy house

Workers can now access up to Sh7 million or a maximum of 40 percent of their retirement savings to buy their first residential house after Treasury Secretary Ukur Yatani signed the amended regulations. Pension schemes have until September 14, 2021 to amend their rules to allow their members early to access their savings for house purchase. The law is meant to boost home ownership in a market where most people employed in the formal sector are unable to raise...

September 25, 2020
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August 2020

19Aug

Kenya. Urgent: Protect pension funds

How safe is your pension? I think Kenyans who contribute money to individual pension schemes are badly exposed. Last week, a whistle-blower, who is an employee of a leading pensions administrator, visited my office, where he proceeded to dump a heap of documents including multi-year audited accounts, balances of member contributions and statements of individual contributors. The whistle-blower’s intention was to show me how the directors of the company had devised clever schemes to steal hard-earned savings of unwitting...

August 19, 2020
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06Aug

Kenya launches contributory pension scheme for government workers

Kenya launched a contributory pension scheme for hundreds of thousands of government workers on Wednesday, to prevent a crisis in the government’s finances from growing retirement obligations. The East African nation, which is facing reduced tax revenue due to the coronavirus crisis and ballooning debt repayments, has been spending 2.9% of its annual budget on pensions payments, the ministry of finance said, in a plan that does not involve contributions by individual workers. Read also Nigeria. Operators invest N55.25bn...

August 6, 2020
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June 2020

24Jun

Kenya proposes CMA to regulate private equity firms

Kenya, a popular investment destination for private equity (PE) firms, has proposed measures to make the operations of PE firms and venture capitalists more transparent by bringing them under the scrutiny of the Capital Markets Authority (CMA). Read also The Mixed Case for Private Equity in Retirement Plans The plan is already causing disquiet among PE firms whose fund raising and choice of companies to invest in is often shrouded in secrecy. The measures were announced by the National Treasury...

June 24, 2020
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12Jun

Kenya. Pensions holdings in bonds up Sh92 billion

Pension funds have raised holdings of government debt by Sh92 billion since the beginning of the year, turning to the securities for assured yields at a time equities and property have taken a beating from the pandemic. The Central Bank of Kenya (CBK) data shows the funds now account for 29.46 per cent of government domestic debt, which at the end of May stood at Sh3.155 trillion. This translates to holdings worth Sh929.7 billion for the pension funds. At...

June 12, 2020
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May 2020
12May

Stock market wipes out Kenyan pensioners’ $350m in just three months

Kenyan retirees lost over Ksh35 billion ($350 million) to falling stock prices and soaring inflation as the Covid-19 pandemic wreaked havoc on the country’s economy in the past three months. Read also Australia. COVID-19 has killed 12% superannuation A survey conducted by Zamara Consulting Actuaries covering 415 pension schemes with a total of Ksh852.4 billion ($8.52 billion) in assets under management shows that the returns on pensioners’ investments in the three months to March 31 dropped, prompting a shift from...

May 12, 2020
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06May

Kenya. State pension pay to rise 29pc next year

The Treasury will spend nearly a third more on paying pensioners in the fiscal year beginning July, with the actual total amount to be spent for the first time expected to exceed Sh100 billion. According to estimates released to Parliament, the total pensions and gratuities paid will amount to Sh119.19 billion, from revised estimates of Sh92.49 billion of the fiscal year ending in June. This is Sh26.7 billion or 29 percent higher. It underlines the extent of liabilities the public has...

May 6, 2020
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06May

Kenya. State pension pay to rise 29pc next year

The Treasury will spend nearly a third more on paying pensioners in the fiscal year beginning July, with the actual total amount to be spent for the first time expected to exceed Sh100 billion. According to estimates released to Parliament, the total pensions and gratuities paid will amount to Sh119.19 billion, from revised estimates of Sh92.49 billion of the fiscal year ending in June. This is Sh26.7 billion or 29 percent higher. It underlines the extent of liabilities the...

May 6, 2020
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April 2020

22Apr

Kenya needs better social protection programmes during Covid-19

While scrolling through Twitter, it is likely that you will come across a post appealing for food aid. As Kenya recorded its 197th confirmed Covid-19 case in early April, many enterprises had reduced their operations, or closed down, causing massive losses in livelihoods. The economic impact has, in turn, increased the prevalence of food-insecure households. Although Kenya has set up a Covid-19 Emergency Fund, it does not currently support provision of food for the most vulnerable households. On Friday,...

April 22, 2020
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21Apr

Debt headache compounds Kenya’s worries amid fears for economy

The impact of the Covid-19 pandemic is likely to be felt in July when the country will need Sh630 billion to settle debts that will fall due. Kenya’s total debt reached a new high of Sh6.3 trillion on March 20. This position has been made worse by the depreciation of the shilling, which has reached an average of Sh106.7 to the dollar, one of the lowest this month. The debt position will get worse in coming months as...

April 21, 2020
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