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MPs query sh26b local govt pension arrears

By Vision Reporter

Added 5th August 2009 03:00 AM

MPs have questioned the escalating pension arrears in the local government ministry amounting to over sh26b.

MPs have questioned the escalating pension arrears in the local government ministry amounting to over sh26b.

By Jude Kafuuma

MPs have questioned the escalating pension arrears in the local government ministry amounting to over sh26b.

The MPs on the public service and local government committee also asked why the Government was paying only sh12b out of the sh26b indicated in the ministry’s policy statement.

Out of the sh12b earmarked for the Ministry of Public Service, sh2b will be used to pay local government arrears while sh10b will clear the central government arrears.

“This implies that the Government cannot even pay the recurrent monthly expenses for the ministry that will accumulate further into more arrears,” remarked committee chairman Anthony Yiga.

There are over 55,000 pensioners, 21,000 of whom have not yet accessed gratuity.

The committee urged the Government to reform the pension scheme and introduce a contributory system for employees and employers.

Yiga explained that under the scheme, both employers and employees contribute money to a pension fund.

The sh26b pension arrears increased due to lack of capacity to pay staff at districts and the abolition of the graduated tax which was a source of revenue for the ministry.

MPs query sh26b local govt pension arrears

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