This archive report was first published on 6 August 2019.
On August 6, 2019, the Kenya Railways pension scheme announced plans to sell two of its estates in Nairobi to address a significant funding deficit.
The estates, Muthurwa and Makongeni, will be sold to the government to support the expansion of Jogoo Road and the construction of affordable homes under President Uhuru Kenyatta's Big Four agenda.
The Kenya Railway Staff Retirement Benefits Scheme (KRSRBS) was established in 2006 to manage pensions for workers who had exited the rail firm. However, the scheme has struggled with poor cash flow, leading to delayed pension payments.
According to Treasury Chief Administrative Secretary Nelson Gaichuhie, the scheme relies on assets that are dilapidated and illiquid, making it challenging to pay pensions. Gaichuhie stated that the scheme's monthly pension liability has risen from Sh25 million in 2006 to Sh70 million today, while only Sh45 million is generated in the same period.
As a result, the scheme has identified the 42-acre Ngara estate as the only one without encumbrances and easy to dispose of. However, the ownership of some properties is contested in court, and eight of the assets are not registered, making them unsellable.
