Undoubtedly, many people are not saving for their retirement due to various factors such as family demands that drain savings from their bank accounts or inadequate income received which cannot make ends meet.
As a result, many are engulfed in uncertainty and dwell in constant fear of the standard of living after retirement. In this regard, the information about unremitted monthly contributions sounds like adding salt to a fresh wound.
It was reported this week that the government has paid over Sh700bn to the country’s registered pension funds with the intention to clear longstanding arrears amounting to Sh1trillion to avert pension settlement crisis.
The amount paid is equivalent to three-quarters of the total debt. That explains how much the entrusted personnel dwelt in business-as-usual mode without adhering to the agreed retirement set of laws despite the unfailing deductions as indicated on monthly salary slips.
We understand that delayed payment of pension arrears has pushed some of the country’s pension funds, especially the Public Service Pension Fund (PSPF), to the brink of a financial crisis.
That is not good news, taking into account that remittance of employees’ monthly contributions is a legal obligation to be honoured by the employers. The only description for accumulated arrears is deliberate defiance of the established financial rules and employment regulations.
We believe that the caution by the Prime Minister to closely follow up the private sector to make sure that employees’ pension contributions are dispatched accordingly will not be taken lightly. Top-ups by employers help people save more for their retirement. Technological advancement facilitates accurate keeping of records to avoid the kind of harassment people endure when pursuing their terminal benefits after retirement.
Major pension funds operating in the country include the National Social Security Fund (NSSF), the Public Service Pensions Fund (PSPF), the Parastatal Pensions Fund (PPF) and others. We believe proper coordination in service delivery will minimize inconvenience to contributors.
Certainly, funds remitted to pension funds are directed to various investment projects as witnessed in different parts of the country. The investment ranges from modern housing, bridges and now focusing attention to agro-industry to help transform the country to a middle income society.
Implementation of such development plans is possible if workers’ contributions are delivered accordingly. We all need to see the country make an economic leap coupled with creation of job opportunities, not forgetting that existence of pension funds has a significant contribution to economic stability.
Some employers might have genuine reasons for delayed remittance of workers’ contributions but, all in all, the rule of law must be allowed to take root. We believe voluntary compliance will become a tradition among employers to avoid unnecessary inconvenience to employees upon retirement.
_0.jpg?itok=QU87XW8D){kind=tracking}
.jpeg?itok=vCj6bCRe)
