Treasury commits to pay retired tutors Sh30bn in pension arrears

Retired Teachers (1197) Group secretary Gidraph Kimatta (centre) addresses journalists and other officials at their offices in Nakuru on February 18, 2016. The government has committed to pay Sh30 billion in salary and pension arrears for the retired teachers. PHOTO | SULEIMAN MBATIAH | NATION MEDIA GROUP

What you need to know:

  • The proposal for the first payment of Sh6 billion will be tabled in Parliament.
  • The second payment of Sh24 billion will be included in the 2016/2017 budget.
  • The agreement to the teachers pension and salary increments was made in 1997.

Retired teachers have struck a deal with the Treasury to receive Sh30 billion in salaries and pension arrears, signalling the end of an 18-year-old dispute.

The government has committed to paying the former teachers in two phases, the first of which has been catered for in the Supplementary Budget soon to be tabled in Parliament.

Sources have confirmed that Sh6 billion has been set aside in the Supplementary Budget to settle part of the arrears for the 52,000 former teachers in the first phase of the payments.

The balance, Sh24 billion, will be included in the 2016/2017 budget to be settled in the second phase, according to the teachers’ lawyer, Mr Dominic Kimatta.

“The payment is part of the agreements we have made with all senior officers from all the relevant departments, including the office of the Director of Pensions and TSC (Teachers Service Commission),” Mr Kimatta said Tuesday.

If approved by the National Assembly, the payment will bring to an end the protracted fight for the benefits that the former teachers were supposed to get upon retirement. They had demanded Sh42.3 billion.

COURT ORDERS

Earlier this month, the Supreme Court ordered the TSC to pay the retired teachers their benefits, in what many of the retirees described as an epic 18-year-court battle.

Some of the retirees have since died, but their lawyer has expressed optimism that the cash will go to the beneficiaries.

Mr Kimatta has urged the relevant state offices to fast-track the release of the award.

Sources close to the TSC told the Nation that the government intends to clear the debt by the end of this year.

The 52,000 retirees who were covered by the 1997 agreement between the government and Kenya National Union of Teachers sued the TSC in 2006, claiming unpaid lump-sum salary raises and accrued pension from July 1997.

The retirees won their first case on October 23, 2008, before Justice David Maraga, who ruled that they were entitled to their retirement benefits.

The commission challenged the award through the Court of Appeal, but a three-judge bench upheld the High Court judgment.

The former teachers have been entangled in unending court battles with the TSC since 2008 that culminated with the court deferring the imposition of a six-month contempt of court jail term against former TSC secretary Gabriel Lengoiboni.

However, the TSC on several occasions attached documents in court detailing communication between Mr Lengoiboni and the Treasury, showing that he had requested an allocation of part of the amount to clear the arrears.

On December 9, 2015, the Supreme Court dismissed an appeal by the TSC challenging the Sh42.3 billion pay award.

The TSC had appealed against the award, arguing that the appellate court’s judgment had serious public policy implications as it touched on the application of the Pensions Act.

The money has been accruing interest at the rate of 14 per cent since the initial judgment was made by Justice Maraga in 2008.