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Treasury Cabinet Secretary John Mbadi has stated that there is no legal foundation for paying gratuity to former councilors.
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During a Senate Plenary session on Wednesday, Mbadi explained that while there is no legal basis for the proposed gratuity payments, eligible individuals will be included in the Inua Jamii social protection program.
The CS clarified that the delay in implementing the October 18, 2018, Senate resolution by the Interagency Task Force was due to the absence of legal support for the initiative.
“The Attorney General, in a legal opinion issued on May 8, 2023, confirmed that there was no legal justification for the proposed honoraria of Sh200,000 for former councilors who served less than 20 years,” Mbadi explained.
He also referenced a circular from the former Ministry of Local Government, which limited pension or gratuity payments to councilors who had served continuously for at least 20 years as of December 13, 1993.
Mbadi pointed out the lack of a structured formula for determining benefits, as councilors were not salaried employees but instead received varying allowances across regions.
Due to these legal and policy gaps, the proposal to allocate Sh2.38 billion to approximately 11,919 former councilors was deemed unsupported. As a result, the Treasury has opted to integrate eligible former councilors into the Inua Jamii program, which aims to provide support to elderly citizens.
“Former councilors who meet the eligibility criteria will be included in the program,” he said, noting that the State Department for Social Protection is working with relevant agencies to verify registrants.
The CS also referred to the National Retirement Benefits Policy, which was approved by the Cabinet in October 2023, and aims to establish a standardized framework for retirement benefits.
“To further strengthen the legal framework, a multi-agency committee was established on September 17, 2024, to review and align public service pension schemes with the Constitution of Kenya 2010,” he added.
Additionally, Mbadi mentioned that the National Treasury will collaborate with the Office of the Auditor General to conduct a forensic audit of the 328 former councilors initially identified for benefits, to address the issue of gratuity payment timelines and confirm the beneficiaries of deceased councilors.
“This audit will verify who is still alive and identify the rightful beneficiaries for those who have passed away,” he stated.
The CS reassured that the government is committed to addressing the welfare of former councilors, but only within the legal framework and available resources.
“Although the original recommendations by the Senate and the Task Force lacked legal support, the alternative solution through Inua Jamii, together with the broader national retirement benefits policy, offers a sustainable and legally sound approach for retired public servants,” he concluded.
