Retirement in Kenya

[Omollo]

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This issue needs to be sorted out once and for all.

Retirement should be based on age and nothing else. It was bumped from 55 to 60 years. That means anybody who is domiciled in Kenya aged 60 and above is considered retired. That should attract their benefits. It should not entail any limitations to their civil rights such as voting and being voted for.

There should be no such thing as Presidential, Prime Ministerial etc Retirements that is over and above what other citizens earn. Retirement should be equitable and should be based on passed declared and taxed income. All earnings by a person over the years should be taken in to consideration when calculating the final figure.

So an MP who started off as a teacher would have this calculated the day he hits age 60. That act will have consequences for his salary as an employee (MP). His primary income will be his pension with allowances coming in addition. Different countries (even in Africa) have over the years made reforms to the system to allow pensioners to keep whatever they earn in addition to their pension. However this is highly controversial especially where the non pension income goes towards increasing their basic pension. The best option to my mind remains where the pensioner is paid anything that exceeds his pension. This is to discourage pensioners from remaining in employment. The converse of it encourages pensioner employment.

So basically Moi should have his benefits from his days as a teacher added to those as an member of Legco / Bunge, Vice President and President. His retirement should be officially start when he hit 60 (of 55 whichever was the case). Any income after that would go towards enhancing the base total for recalculating the pension.

Any such paid privileges like free car, office etc must be taxed.

[RV Pundit]

I disagree. Nobody is entitled pension.

Retirement should be funded by whoever intended to get pension when he retires. The employee should contribute a percentages towards that pension fund say 50% matching fund. The pension should either be private (through private pension fund) or through public (nssf or 401k in US).

Right now we are  paying annually about 80B kshs to all sort of pensioners that draw pension from gov (retired civil servants and teachers). This is unfounded pension that is deducted from our taxes. So nearly every 10% of our taxes goes into paying pensions. This is dangerous and not prudent. It certainly not the best way to use our taxes.

Way forward..SRC..should enforce funded pension by everyone...you want to retire into poverty...then contribute nothing...you want to retire well...then contribute more. You want to buy land and build flats for your old age...then fine...start your own personal pension plan.

This should apply to everyone..Serem should simply enforce that...so a president can decide from his 2m kshs per ammount..to save 10% (200K) and gov gives him another 200K..he has 400K which is parked in an investment vehicle monthly...in 5yrs...that should have grown to 400K*60..24M without compounding the annual returns...so maybe 40-60M. That will be his pension in 5yrs..in 10yrs..he walks home with even more..maybe 200M. That is his rightful earned pension and nobody will complain.

If you fall into poverty..then register for welfare or social support..like is currently happening where gov mpesa those that are too old and poor some 2k per month.

This issue needs to be sorted out once and for all.

Retirement should be based on age and nothing else. It was bumped from 55 to 60 years. That means anybody who is domiciled in Kenya aged 60 and above is considered retired. That should attract their benefits. It should not entail any limitations to their civil rights such as voting and being voted for.

There should be no such thing as Presidential, Prime Ministerial etc Retirements that is over and above what other citizens earn. Retirement should be equitable and should be based on passed declared and taxed income. All earnings by a person over the years should be taken in to consideration when calculating the final figure.

So an MP who started off as a teacher would have this calculated the day he hits age 60. That act will have consequences for his salary as an employee (MP). His primary income will be his pension with allowances coming in addition. Different countries (even in Africa) have over the years made reforms to the system to allow pensioners to keep whatever they earn in addition to their pension. However this is highly controversial especially where the non pension income goes towards increasing their basic pension. The best option to my mind remains where the pensioner is paid anything that exceeds his pension. This is to discourage pensioners from remaining in employment. The converse of it encourages pensioner employment.

So basically Moi should have his benefits from his days as a teacher added to those as an member of Legco / Bunge, Vice President and President. His retirement should be officially start when he hit 60 (of 55 whichever was the case). Any income after that would go towards enhancing the base total for recalculating the pension.

Any such paid privileges like free car, office etc must be taxed.

[Omollo]

Perhaps I was unclear or you mixed issues.

This is not about pension really but retirement. At what age should one be considered retired?

I have then talked a bit about those in Public Employment who are contributing through NSSF etc. They should be eligible for retirement at the same age.

We can talk about private retirement plans etc. I have no issues with them. It's a private arrangement.

I disagree. Nobody is entitled pension.

Retirement should be funded by whoever intended to get pension when he retires. The employee should contribute a percentages towards that pension fund say 50% matching fund. The pension should either be private (through private pension fund) or through public (nssf or 401k in US).

Right now we are  paying annually about 80B kshs to all sort of pensioners that draw pension from gov (retired civil servants and teachers). This is unfounded pension that is deducted from our taxes. So nearly every 10% of our taxes goes into paying pensions. This is dangerous and not prudent. It certainly not the best way to use our taxes.

Way forward..SRC..should enforce funded pension by everyone...you want to retire into poverty...then contribute nothing...you want to retire well...then contribute more. You want to buy land and build flats for your old age...then fine...start your own personal pension plan.

This should apply to everyone..Serem should simply enforce that...so a president can decide from his 2m kshs per ammount..to save 10% (200K) and gov gives him another 200K..he has 400K which is parked in an investment vehicle monthly...in 5yrs...that should have grown to 400K*60..24M without compounding the annual returns...so maybe 40-60M. That will be his pension in 5yrs..in 10yrs..he walks home with even more..maybe 200M. That is his rightful earned pension and nobody will complain.

If you fall into poverty..then register for welfare or social support..like is currently happening where gov mpesa those that are too old and poor some 2k per month.

This issue needs to be sorted out once and for all.

Retirement should be based on age and nothing else. It was bumped from 55 to 60 years. That means anybody who is domiciled in Kenya aged 60 and above is considered retired. That should attract their benefits. It should not entail any limitations to their civil rights such as voting and being voted for.

There should be no such thing as Presidential, Prime Ministerial etc Retirements that is over and above what other citizens earn. Retirement should be equitable and should be based on passed declared and taxed income. All earnings by a person over the years should be taken in to consideration when calculating the final figure.

So an MP who started off as a teacher would have this calculated the day he hits age 60. That act will have consequences for his salary as an employee (MP). His primary income will be his pension with allowances coming in addition. Different countries (even in Africa) have over the years made reforms to the system to allow pensioners to keep whatever they earn in addition to their pension. However this is highly controversial especially where the non pension income goes towards increasing their basic pension. The best option to my mind remains where the pensioner is paid anything that exceeds his pension. This is to discourage pensioners from remaining in employment. The converse of it encourages pensioner employment.

So basically Moi should have his benefits from his days as a teacher added to those as an member of Legco / Bunge, Vice President and President. His retirement should be officially start when he hit 60 (of 55 whichever was the case). Any income after that would go towards enhancing the base total for recalculating the pension.

Any such paid privileges like free car, office etc must be taxed.

[RV Pundit]

There are not separate issues. Retirement age is only an issue because gov all over the whole have UNFUNDED PENSION liabilities. So naturally they want to play around the ages so people die off or die soon after before they drain the tax payers.

Private sectors operates on funded pensions. Gov (including US or Greece) have to move towards the same. And then it should not matter when your retire.

If I retire today; as private sector person; I can withdraw my pension; but in gov; gov has to play around; tell you wait for 20 yrs...and the reason is the same..unfunded pensions have to be repaid annually from taxes.

The questions of retirement and retirement age...is non-existent..when everyone is responsible for their pension and pension plan..including civil servants, mps, teachers and name them.

Kenya Gov have been talking about this but have not gotten to implement it...the last real reform in this sector was enactment of RBA (retirement benefit authority)..but gov largely want to operate using the old system that you think can be refined...it can only be refined by moving the age further and further towards 70 (Europe nearing there)...and praying more and more workers die soon after.

Simple answer to your quiz? At what age should one be considered retired. When you want to retire.

Perhaps I was unclear or you mixed issues.

This is not about pension really but retirement. At what age should one be considered retired?

I have then talked a bit about those in Public Employment who are contributing through NSSF etc. They should be eligible for retirement at the same age.

We can talk about private retirement plans etc. I have no issues with them. It's a private arrangement.

[Omollo]

Let me try again...

The subjects are related but not the same. I'll try my level best: Legally retirement is when ceases employment as a result of age. If one ceases to work while under the retirement age, he is referred to as "Unemployed" etc. I believe as statistician you must be aware of that, unless I am mistaken about your background.

Now Retirement Benefits: The fact that one has retired does not mean he receives a pension. He may or may not. However if he is eligible for it, we can refer to this as "pension", Retirement benefits etc.

You have yourself hinted knowledge of these terms by your use of the term "unfunded Pension". In principle it does not have to be funded nor should one expect it to be if there is no funding plan.

The reason I am opposed to the Presidential pension etc is because it is discriminatory and favours certain classes of people as opposed to others. Everyone should pay for his pension. We can expand NSSF to cover even the unemployed and self employed - same way NHIF is trying to do. With the oil money on the way, that can help to fund it for everyone.

Remember I am a modern socialist so we will disagree about certain things. For instance I believe mother who stay home to look after their kids and forego working should be rewarded with a pension. The costs should be shared by all those working and companies paying taxes.

There are not separate issues. Retirement age is only an issue because gov all over the whole have UNFUNDED PENSION liabilities. So naturally they want to play around the ages so people die off or die soon after before they drain the tax payers.

Private sectors operates on funded pensions. Gov (including US or Greece) have to move towards the same. And then it should not matter when your retire.

If I retire today; as private sector person; I can withdraw my pension; but in gov; gov has to play around; tell you wait for 20 yrs...and the reason is the same..unfunded pensions have to be repaid annually from taxes.

The questions of retirement and retirement age...is non-existent..when everyone is responsible for their pension and pension plan..including civil servants, mps, teachers and name them.

Kenya Gov have been talking about this but have not gotten to implement it...the last real reform in this sector was enactment of RBA (retirement benefit authority)..but gov largely want to operate using the old system that you think can be refined.

Perhaps I was unclear or you mixed issues.

This is not about pension really but retirement. At what age should one be considered retired?

I have then talked a bit about those in Public Employment who are contributing through NSSF etc. They should be eligible for retirement at the same age.

We can talk about private retirement plans etc. I have no issues with them. It's a private arrangement.

[RV Pundit]

I think you're not clear coz perhaps you're discussing Raila-Kalonzo retirement age without get the context or making it general innocent query about retirement in kenya.
 
Legally there is nothing like retirement age. There is legal age when one is under age [under 16 or under 18] or young[under 35] or old [over 65yrs -mostly].

In statistics that is what we mostly use >65 is defined as OLD. I think the constitution ought to define that if it has not.

As far as I know retirement age is determine by the employee. It can be anything. In kenya gov employees retire at 60yrs (this changes depending on what gov actuarist think is sustainable)....but private sector employees retire at any age. You can be declared redundant or retired due to many reason age be one of them.

We are in agreement if you think everyone should pay for their pension. That they do by funding their pension plan through contribution while employed or earning.

When it comes to top gov officials like former Mp or VP or police commissioner...i think they are entitled to some benefits & perks as soon as they retire or are fired or etc (even at 30yrs)..benefit mostly related to security (they have made dangerous enemies doing their work)..and perhaps free parking space in town.  That should not be confused with PENSION. These really should be special retirement benefits and perks due to the nature of their job. These benefits can have conditions.

Their pension  should be calculated like any civil or public servants...whether funded or unfounded...depending on where and how long they've worked..and what they earned.

The housewife should not be entitled to any pension unless she had her plan but social or welfare support if he applies or qualifies. Naturally she should share the husband pension and if there a problem in marriage..the court should grant her the right to the husband pension...for her part raising the family.

Pension should be linked to employment terms and conditions..or someone's egg nest...agreed before hand. Retirement benefits including an umbrella and t-shirt can be decided on case by case basis.

Let me try again...

The subjects are related but not the same. I'll try my level best: Legally retirement is when ceases employment as a result of age. If one ceases to work while under the retirement age, he is referred to as "Unemployed" etc. I believe as statistician you must be aware of that, unless I am mistaken about your background.

Now Retirement Benefits: The fact that one has retired does not mean he receives a pension. He may or may not. However if he is eligible for it, we can refer to this as "pension", Retirement benefits etc.

You have yourself hinted knowledge of these terms by your use of the term "unfunded Pension". In principle it does not have to be funded nor should one expect it to be if there is no funding plan.

The reason I am opposed to the Presidential pension etc is because it is discriminatory and favours certain classes of people as opposed to others. Everyone should pay for his pension. We can expand NSSF to cover even the unemployed and self employed - same way NHIF is trying to do. With the oil money on the way, that can help to fund it for everyone.

Remember I am a modern socialist so we will disagree about certain things. For instance I believe mother who stay home to look after their kids and forego working should be rewarded with a pension. The costs should be shared by all those working and companies paying taxes.