RBA back to drawing board after setbacks

The Retirement Benefits Authority (RBA) will next year rely on public goodwill to drive the old-age savings above 20 percent.

The RBA has launched a campaign urging Kenyans to save for old age, which it says is the only way to guarantee a future free of want and suffering.

The agency would wish to forget 2019 since MPs threw out its plea to have contractual workers compelled to join pension schemes and a law barring workers leaving jobs accessing half employer contributions.

The agency had sought to compel contractual workers to join a savings scheme of their choice where employers would be required to submit part of their earnings to the retirement funds.

RBA Chief Executive Nzomo Mutuku said it would seek government support to compel contractual workers to save for retirement come June 2020 though. The regulator argued many employers opted to retain a lower number of permanent employees, which reduced their contributions to staff benefits while increasing the number of contractual workers, which freed them from the statutory obligation of deducting money.

“We shall try again since our study shows a paltry 20 percent of Kenyans, mostly in formal employment, save for their old age while the bulk of workers in corporate, small and medium enterprises are contract workers that should also be forced to save for their old age,” he said in a recent event.