Regulation of Pension Schemes in Kenya_ a Case for a Pensions Guarantee Fund
Warui, Jackline W
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The right to social security is provided for under Article 43 (1) (e) of the Kenyan Constitution. Kenya also has an obligation to ensure enjoyment of this right under the international conventions that it has ratified which now form part of our laws as per article 1 (5) and (6) of the Constitution. The right to social security refers to protection measures or programs which are meant to promote the welfare of the population and protect them against economic and social distress. Among such measures is the protection of pension schemes benefits. Pension schemes benefits assist individuals to continue with their usual life upon death of the breadwinner, incapacitation, loss of employment or after retirement. For this reason, they should be safeguarded against loss in any possible way. Pension schemes face many challenges among them poor administration and investments of pension funds, lack of transparency and accountability, misappropriation of scheme assets by the trustees and loss of scheme funds through negligence of trustees and insolvency. There is thus need to protect them against such risks in order to realize the right to social security. One of the ways in which pension scheme benefits can be protected is by establishing a pensions guarantee fund in Kenya. This study thus seeks to make a case for establishment of a pensions guarantee fund in Kenya while making proposals on how such a fund can be effectively managed. This study is informed by the life hypothesis cycle which propounds that people plan their spending based on their current income and expected future income. Since they may not have the strength to work more when old, they save up during their youthful days via pension schemes. If these savings are not protected, then the whole purpose of pension schemes will be defeated.
University of Nairobi
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