Attitudes of informal sector workers towards saving for retirement (Pension) at Kamukunji jua-kali, Nairobi
This report documents the findings from a qualitative research project designed to examine the attitudes of informal sector workers towards saving for retirement pensions. The research sought to inform the workers perceptions towards the existing pension schemes more specifically the Mbao pension plan that is designed for low income earners. Six group discussions were conducted; three for female and three for males. Each gender was separated into three age groups, consisting of ages 18-29, 30-40 and 41-55 with between six and eight participants were conducted in October 2013. Each of these lasted for approximately two hours. Participants were recruited on the basis of age, gender, work status and whether they were currently saving for a pension. These groups were supplemented by a series of five follow-up face-to-face key informant interviews of approximately one to one and a half hours in length. The key informants who were interviewed consisted of a shop steward for the Mbao pension plan, the secretary of the Jua Kali Association, and an artisan who has worked in the cluster for several years and was perceived as an opinion leader, an artisan who has been saving for retirement for the last one year and a hotel owner who has knowledge of the scheme but does not see any compelling reason to save. There was a broad consensus that saving was a good thing and that people should be making provision for the future – both in the long- and short-term. However, there were also negative stereotypes of typical savers and the sort of lifestyle they led; many had a vision of ‘misers’ livingserious lives.Participants were very much focused on their immediate lives and had rarely given any thought to the future beyond the next few years, let alone their retirement years and how they would fund them. Old age tended to be perceived as restricted, boring and bleak and not worth thinking about, although some participants also cited the experience of family members living a positive and happy old age. Few participants were concerned about their own retirement, although they were aware that this time may not always be ‘rosy’. A few participants understood the basic principles of pension schemes, but generally there was little understanding of different types of pensions and how they operate. Many participants perceived that the amount they could afford to save in a pension was too small to be worthwhile, and what little money they did have spare was allocated to more immediate demands such as university or moving to their first home. Some participants perceived that other savings vehicles were preferable to pensions as they thought they offered higher returns. The most commonly-cited of these was buying a property and livestock. This perception was heightened by a mistrust of pensions, with participants fearing that there was a risk of corruptstate employees embezzling the funds or pension companies becoming insolvent and scheme members losing their money and notbeing compensated.