This archive report was first published on 13 May 2020.
Kenya's pension administrators are pushing back against proposed changes to the retirement law that would allow pensioners to access up to 40% of their savings to buy houses.
The Association of Retirement Benefits Schemes (ARBS) has written to the pensions regulator, the Retirement Benefits Authority (RBA), requesting a month to discuss the proposed changes.
ARBS chairman Simon Nyakundi argued that the proposed changes would increase the scope of work for pension trustees, who are already responsible for safeguarding pension savings.
‘House buying involves private contracts between two parties, and trustees would need to conduct due diligence on a property before allowing its purchase,' Nyakundi said. ‘Who will foot this bill, and who will remunerate them?'
The RBA has given stakeholders until May 13, 2020, to submit proposals on how the Sh1.3 trillion retirement kitty will be sliced to fund house purchases for pension savers.
However, the proposed changes have been met with resistance from pension administrators, who argue that they would be unable to supervise house purchases and vet contracts without additional resources.
The planned changes follow President Kenyatta's assent to the RBA Act, Section 38 amendment, which allowed pension savers to access a slice of their savings to buy houses.
