The National Social Security Fund (NSSF) has launched an ambitious initiative to disburse claims within 24 hours after submission, in response to the revelation that a staggering 84 per cent of Kenyan adults lack social security savings, according to recent statistics.
David Korros, CEO of the NSSF, stressed the importance of addressing long-standing claims processing delays."NSSF has been notorious for delaying claims for up to one year," Korros stated. "We are committed to making this a thing of the past by guaranteeing that claims are processed within a day, aiming to achieve this by 2027."
Korros elaborated, "Our objective is clear: when you file a claim with NSSF, your benefits should be in your account within 24 hours, regardless of when the claim is launched."
During the launch of NSSF's Corporate Strategic Plan 2023-2027 on Tuesday, May 7, alarming statistics emerged illustrating the inadequacy of pension schemes in providing for retirees.
Only 6 per cent of retirees rely on pension schemes, with a significant 60 per cent of pensioners still engaged in employment to sustain themselves.
Prime Cabinet Secretary Musalia Mudavadi pointed out the pressing need for NSSF to expand its reach, stating, "With an income replacement ratio upon retirement of just 40 per cent, well below the recommended level of 75 per cent, many retirees are finding themselves struggling to make ends meet in their golden years."
Furthermore, the data released by NSSF revealed that despite NSSF saving over Ksh350 billion according to President William Ruto, 1.2 million elderly persons sleep hungry, with 800,000 elderly persons in Kenya living alone.
Concerns about NSSF's financial management have been there for a while. In 2022, Auditor General Nancy Gathungu revealed that retirees had failed to claim Ksh166.83 million in benefits by the end of June 2022.
Additionally, the fund came under scrutiny for not remitting funds to the Unclaimed Financial Assets Authority, resulting in unclaimed benefits amounting to Ksh3.6 billion.
A baseline survey estimated that Ksh241 billion in unclaimed financial assets remained unreported, pointing to the need for robust regulatory mechanisms to safeguard retirees' interests.
These unclaimed assets show systemic challenges, including the absence of adequate estate planning and beneficiaries unaware of their entitlements.
NSSF CEO added his rallying call for Kenyans to embrace the saving culture stating, "Savings for retirement is not a tax. We want Kenyans to understand that we need to save for our retirement. We need to improve our savings rate as a percentage of GDP. We need to grow it to a level of about 30 per cent."
He added, "Majority of Kenyans are young. If they save for the next 30 years, they will retire to a good life."
