Expenditure on pension for retired public servants has more than doubled in first month of the current financial year on the back of mass exits in recent years amid a persisting lag in the processing of the payouts.
Pension and gratuity payouts in July amounted to Sh9.63 billion, a 156.21 percent climb over Sh3.76 billion a year earlier, according to statistics published by Treasury secretary Ukur Yatani last Friday.
The payouts to retired civil servants represent 6.27 percent of the record Sh153.64 billion budgeted for this fiscal year ending June 2022 but lag a prorated monthly target of Sh12.8 billion by 24.81 percent.
The Treasury struggled to process payouts in line with targets last financial year through June 2021 in the wake of Covid-induced social distancing rules that prompted some workers to operate remotely from home.
For instance, Sh76.26 billion, or 68.61 percent, of Sh111.14 billion goal had been paid out by May 2021, trailing the target by Sh34.88 billion a month to the end of the fiscal year.
Mr Yatani as yet to gazette exchequer statement for the period ended June 2021.
“The commitment we have given ourselves is that by the turn of the financial year (ending June 2021), we want everybody who retires to access his pension the next month, meaning you are on salary payroll this month and the next month you should be on our pension payroll,” director of Pensions at the Treasury Michael Kagika had said in an earlier interview.
The mass retirement of public servants in the past three years has piled more pressure on taxpayers, with annual payments surging 162.69 percent from Sh58.49 billion in the financial year ended June 2017.
More than 60,000 public servants retired in three years through June 2020 —20,300 workers in the year ended June 2020 up from 19,800 a year earlier and 19,300 in the financial year 2017/18.