dc.description.abstract | Regulatory controls have a significant effect on the growth of the pension schemes.
This means that pension regulatory controls lead to improved financial performance
and growth of the individual pension schemes. This study aimed to find out what has
been the effect of the regulatory control changes passed since 2008 to date on the
financial performance of pension schemes.
The study used cross sectional survey design. The population for this study were the
1216 pension schemes registered with the Retirement Benefit Authority (RBA). A
sample of 10 pension schemes was selected using convenience sampling. Secondary
data on the performance of pension schemes was collected from the industry reports
compiled by the Retirement Benefits Authority. Analysis was performed using ratio
analysis and paired sample t-tests using MS Spreadsheets and SPSS.
The results for the tests for significance of the differences in performance of the firms
after the introduction of the regulatory changes show that there is a significant
difference in the performance of the schemes. They show that the examined ratios
were significantly influenced by the regulatory changes and since the p value is less
than 0.05, there is a significant difference in the ratios before and after the regulatory
changes. It also found that reducing the benefits processing period, regulating the fees
charged by the service providers, and allowing access of 50% of the employer’s
portion have influenced the financial performance and growth of individual pension
schemes in Kenya, as measured by several financial ratios; the Scheme expense ratio,
the Current ratio, the Return on Investment and Leverage.
The study concludes that regulatory changes have a significant influence on the
performance of pension schemes in Kenya as the results have passed significance
tests. Therefore, the various changes in regulatory controls have had a major effect on
the performance of pension schemes in Kenya. It recommends that the policy makers
should evaluate the regulatory changes that they propose so that the changes can be
able to stimulate growth in the pension industry rather than stifle it. It also
recommends that the government through the Retirement Benefits Authority should
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put up strict measures to ensure that the pension schemes are observing the
regulations enacted as a way of ensuring improved performance. | en |