Government falls behind on Sh1.2 billion pension contributions
By August, the State had cleared Sh9.38 billion, leaving Sh1.2 billion still outstanding during the audit. Such delays reduce the time available for funds to grow, putting retirees’ benefits at risk.
The government’s failure to transfer Sh1.2 billion in civil servants’ pension contributions has sparked concerns over the safety of retirement savings and the ability of workers to earn expected returns.
The latest audit by the Office of the Auditor General shows that the Public Service Superannuation Fund (PSSF) had Sh10.6 billion in unremitted contributions by the end of June 2025.
More To Read
- Only two of 63 performance audits discussed by MPs since 2012 - Auditor General
- County expenditure share by sector (FY2023/24)
- MPs back move to amend finance law to align audit timelines with Constitution
- State agencies, counties owe Kenya Power Sh4.67 billion in unpaid bills - Auditor General
- Over 16,000 in the dark as Kenya Power struggles to procure essential meters, transformers
- MPs push for urgent funding boost for Auditor General’s office
By August, the State had cleared Sh9.38 billion, leaving Sh1.2 billion still outstanding during the audit. Such delays reduce the time available for funds to grow, putting retirees’ benefits at risk.
Auditor General Nancy Gathungu noted, “This is contrary to Section 8(c) of the Public Service Superannuation Scheme Act, 2012, which states that, not later than 10 working days after the end of the month in which the contributions are due, the government shall remit an amount comprising the member’s and the government’s contribution to the custodian.”
“Unless the outstanding balance is paid together with the penalty provided for, contributors stand to lose returns that would have been earned had the contributions been received in time,” she added.
The government has a history of delaying payments to the civil servants’ pension scheme. In the year ending June 2023, Sh219.9 million was not transferred to PSSF, while in the following financial year, Sh3.2 billion in contributions were delayed, though eventually settled by September 2024.
Pension experts warn that such persistent delays weaken confidence in Kenya’s retirement system and could impact not only workers’ savings but also the funding of State projects.
The recurring non-remittance highlights ongoing challenges in ensuring the security and efficiency of public pension contributions.
Earlier, the Auditor General revealed that while the PSSF grew to a record Sh242 billion in the year ending June 2025, significant sums that could have earned investment returns were left unremitted.
This figure includes both employer and employee contributions that were deducted from workers’ salaries but not forwarded to the fund on time.
Of this amount, Sh9.38 billion was eventually paid after the fiscal year ended in August 2025, while Sh1.22 billion remained unpaid.
Gathungu warned that the delays violate the Public Service Superannuation Scheme Act of 2012, which mandates that contributions must be remitted within 10 working days after the end of the month in which they are due.
Top Stories Today
