On Monday last week the President assented to the Presidential Retirement Benefits Amendment Bill and rejected Retirement Benefits (Deputy President and Designated State Officers) Bill. Presidential Retirement Benefits (Amendment) Bill 2012 makes amendments to the Presidential Retirement Benefits Act, 2003 to take into account inflation trends and for connected purposes. What “connected purposes” are is unexplained but in layman’s terms what the Presidential Retirement Benefits Amendment Bill does is it substantially raises the cost of the retired president to the tax payer.
Of course the argument has been made that the President assenting to his own retirement benefits while rejecting retirement benefits for MPs and State Officers is a fair trade off. Why? The send off for MPs and State Officers was going to cost tax payers upwards of 2.6 billion shillings while the President’s retirement benefits are going to cost tax payers an estimated 25 million shillings, and 25 million is much less than 2.6 billion.
The catch is that President’s pension gets remitted to him until the day of his death and after that to his spouse until her death in the long run this could add up to billions of shillings.
The papers have estimated that the initial benefits will cost taxpayers at least 25 million shillings. According to the Presidential Retirement Benefits Amendment Bill 2012 and Presidential Retirements Benefits Act 2003 this is how the 25 million it breaks down: Kshs. 9,120,000 in calculable benefits plus the cost of other benefits which amounts are not included in the Act.
|Lump sum payment on retirement, calculated as a sum equal to one and half year salary for each term served as President. The President has served two terms according to newspaper sources the President earns a basic salary of 2 million shillings||6,000,000|
|A monthly pension equal to eighty per cent of the monthly salary currently paid to the President.||1,600,000 per month|
|An entertainment allowance equal to 15% of the President’s annual salary||300,000 per month|
|A housing allowance to cater for both an urban and a rural dwelling equal to 23% of the President’s annual salary||460,000 per month|
|Fuel allowance equal to 15% of the President’s current annual salary||300,000 per month|
|Electricity, water and telephone facilities equal to 23% of the President’s annual salary
|460,000 per month|
Additional benefits include
- A suitable office space, not exceeding one thousand square metres, with appropriate furniture, furnishings, office machines, equipment and office supplies, to be provided and maintained by the Government
- two new cars of the retired President’s choice, replaceable every three years, each car having an engine capacity of three thousand cubic centimetres
- two four-wheel drive motor vehicles of the retired President’s choice, replaceable every three years, each vehicle having an engine capacity of three thousand, four hundred cubic centimetres
- full medical and hospital cover, providing for local and overseas treatment, with a reputable insurance company for the retired President and his spouse and his children under the age of eighteen years;
- Staff: Two personal assistants; four secretaries; four messengers; four drivers; 12 guards (6 personal and 6 residential); two gardeners; 2 laundry persons; four house cleaners; two house keepers; two cooks;
- office maintenance; maintenance and running expenses of vehicles;
- a diplomatic passport; local travel; and international travel allowance of up to four trips a year not exceeding two weeks each.
And according to the Act all this shall be tax exempt, “The pension and other benefits conferred by this Act shall, notwithstanding the provisions of any other law to the contrary, be exempt from tax.”
While I’m sure no Kenyan is opposed to the President receiving a fair pension, this is exorbitant and seems unconstitutional given that the law seems to have been passed without the say so of the Salaries and Remuneration Commission, the body mandated to regulate and determine salaries of state officers, including the President.