All set for county staff pension fund
Council of Governors chairman Isaac Ruto addresses the press after a meeting with County Assemblies Forum officials and speakers at Maanzoni Lodge in Machakos on November 24, 2014. The meeting was called to discuss a new pension scheme for county workers. PHOTO | BILLY MUTAI | NATION MEDIA GROUP
What you need to know:
- County governments inherited workers of defunct local authorities and water companies who had two schemes, the Local Authority Pension Fund (Lapfund) and Local Authority Pension Trust (Laptrust).
- Lapfund is a provident fund where members are paid the entire amount invested on retirement while Laptrust pays a third with the rest spread over time.
- The Council of Governors had opted for Lapfund, arguing it is not controlled by the National Government.
A Bill requiring all employees of county governments to join a new pension scheme is on the way.
If it becomes law, the County Subscription Bill will require workers of all the 47 counties to pay a monthly subscription to a County Public Service Staff Pension Scheme.
Council of Governors chairman Isaac Ruto said in Machakos yesterday that the proposed law would end squabbles about which pension scheme county workers should join.
The issue has been the subject of debate since the devolved units came into existence 18 months ago.
County governments inherited workers of defunct local authorities and water companies who had two schemes, the Local Authority Pension Fund (Lapfund) and Local Authority Pension Trust (Laptrust).
Lapfund is a provident fund where members are paid the entire amount invested on retirement while Laptrust pays a third with the rest spread over time.
The Council of Governors had opted for Lapfund, arguing it is not controlled by the National Government.
However, this decision sparked controversy and county governments had to stop remitting pension deductions until the matter was resolved.
Yesterday, the Council of Governors met to try and bring the issue to an end.
Invited were deputy governors, county assembly speakers and County Assemblies Forum members.
A technical committee of the Retirement Benefits Authority had recommended a merger of Lapfund and Laptrust to form an umbrella retirement scheme.
But Mr Ruto said it would not be wise to inherit liabilities after the merger and that control over the new scheme by the National Government should be avoided.
“We decided to pick an existing fund to avoid legal quagmires,” the Bomet governor said, adding this was how Lapfund was chosen.
