Kenya launches plan to promote retirement benefits sector
Kenya on Thursday launched a strategic plan aimed at promoting an inclusive and sustainable retirement benefits sector.
Chris Kiptoo, principal secretary in the National Treasury and Economic Planning, told journalists in Nairobi, the capital of Kenya, that the five-year Retirement Benefits Authority Strategic Plan aims to grow the country’s retirement savings from 1.7 trillion shillings (about 13.2 billion U.S. dollars) to 24.8 billion dollars by 2029.
“The blueprint also details steps to expand pension coverage from the current 26 percent of the workforce to 34 percent by 2029,” Kiptoo said.
He said that retirement benefits coverage remains low, largely due to the structure of Kenya’s labor market, where about 85 percent of workers are employed in the informal sector, making retirement savings uncommon.
Charles Machira, chief executive officer of the state-owned Retirement Benefits Authority, said that the strategy seeks to address challenges facing the sector, including fragmented legislation and low awareness of the importance of saving for retirement. He added that the plan will help Kenya improve its average income replacement at retirement to meet the United Nations’ International Labor Organization’s recommended rate of 40 percent.
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