Members of Parliament (MPs) have taken full control of their pension payments from the Treasury, giving them a perfect avenue to determine what they will take home when their term expires on August 9, 2022.
This is after the National Assembly on Thursday, August 5, unanimously approved changes to the Parliamentary Pension (Amendment) Bill.
The move by lawmakers transfers the management of their retirement perks to the Parliamentary Service Commission (PSC) stripping off the National Treasury of the powers.
The Bill vests the MPs with total power to choose between making monthly contributions and the gratuity payable at the end of each term.
The new gratuity scheme will allow MPs to enjoy an equivalent of 31 per cent of their basic salary for a 60-month term without remitting even a cent to the kitty.
“The payment of pension, gratuity, refund of contributions and other allowances payable shall be provided for in the estimates of the commission (PSC) pursuant to Article 127 of the Constitution,” the changes, moved by Finance committee chair Gladys Wanga, states.
Legislators who opt to remain in the monthly pension scheme will not get the gratuity but will remain in line for a lifelong monthly payout of at least Ksh125,000. This is under the condition that the lawmaker exits after serving for a minimum of two terms.
The MPs further made changes to the Parliamentary Pensions Act which empowers the PSC to make regulations for prescribing anything required by the proposed Bill.
“Without prejudice to the generality of sub-section (1), regulations under this Act may provide for the administration of pension, gratuity and other benefits to Members of Parliament,” the Bill states.
The Bill also allows lawmakers to enjoy medical cover beyond the expiry of their term.
The Pension Amendment Bill now awaits President Uhuru Kenyatta's signature before it becomes law.
