Teachers, Civil Servants asked to support increased NSSF deductions

𝐑𝐞𝐭𝐢𝐫𝐞𝐦𝐞𝐧𝐭 𝐁𝐞𝐧𝐞𝐟𝐢𝐭𝐬 𝐀𝐮𝐭𝐡𝐨𝐫𝐢𝐭𝐲 (𝐑𝐁𝐀) 𝐮𝐫𝐠𝐞𝐬 𝐊𝐞𝐧𝐲𝐚𝐧𝐬 𝐭𝐨 𝐞𝐦𝐛𝐫𝐚𝐜𝐞 𝐭𝐡𝐞 𝐮𝐩𝐜𝐨𝐦𝐢𝐧𝐠 𝐢𝐧𝐜𝐫𝐞𝐚𝐬𝐞 𝐢𝐧 𝐩𝐞𝐧𝐬𝐢𝐨𝐧 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧𝐬 𝐚𝐬 𝐚 𝐬𝐭𝐞𝐩 𝐭𝐨𝐰𝐚𝐫𝐝𝐬 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐬𝐞𝐜𝐮𝐫𝐢𝐭𝐲 𝐢𝐧 𝐫𝐞𝐭𝐢𝐫𝐞𝐦𝐞𝐧𝐭.

RBA Chief Executive Officer Charles Machira stated that “the proposed in the National Social Security Fund (NSSF) Act 2013, it isn’t a tax. It’s an investment in your future to ensure retirees can live dignified lives.”

The RBA CEO added that the Act provided for a phased escalation of the contributions by both employer and employee and the formulas proposed under the schedules that contributions would double from the current Sh. 4,320.

“I would like to encourage our people in the labour force that you have been saving Sh400 before the NSSF Act 2013; the provision now is that you are saving Sh. 8,640, which is employee money, and the employer contributes 50 per cent of that for those who have salaries beyond Sh. 72, 000, but we can still apply the formula on a pro-rata basis for those earning a lesser amount,” Machira said.

He further clarified that the money does need to fully go to NSSF, adding that for employees in other pension schemes, RBA offers opportunities to “Contract out” meaning that an amount that is beyond a particular threshold, in this case Sh. 960 from February, can remain in the pension scheme.

“What I’d like Kenyans to appreciate is that the space we’re enhancing, we would like people to retire with adequate retirement income; NSSF is playing a critical role in filling the gap of adequacy in retirement,” Machira added.