TUK on the Spot Over Missing Ksh235 Million Pension Funds

The Senate Committee on Labour and Social Welfare, on Thursday, September 25, put the management of the Technical University of Kenya (TUK) on the spot over the collapse of its staff retirement benefits scheme, which has left retirees and soon-to-retire employees in financial distress.

Appearing before the committee chaired by Chair Kilifi Senator Stewart Madzayo, Vice-Chancellor Prof. Benedict Mutua was pressed to explain how deductions were made for years without being remitted to the pension scheme.

The committee heard that between 2009 and 2013, TUK operated an unregistered scheme and deposited contributions into a non-compliant savings account at Kenya Commercial Bank.

By April 2013, the account held Ksh244.9 million. Barely a month later, on May 8, the balance had plummeted to Ksh9.5 million.

The application to register the Technical University of Kenya Staff Retirement Benefits Scheme (TUKSRBS) was only submitted on May 29, 2013—after the account had been drained—before eventual registration in November of the same year.

RBA Comments on TUK Scheme

The Retirement Benefits Authority (RBA) Chief Executive Charles Machira described the scheme’s current position as catastrophic, revealing a funding ratio of just 17 percent.

“Anybody who has a million Kenyan shillings in accrued benefits can only be paid 170,000 shillings,” he said.

The High Court ordered the liquidation of the scheme after finding that its assets, valued at Ksh755 million, could not cover liabilities of Ksh4.2 billion, and appointed an official receiver to manage the remnants.

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Senators Accuse Administration of Corruption

Senators reacted with outrage, accusing university officials of presiding over a deliberate scheme to siphon workers’ savings.

“This was actually a scheme organized and coordinated by managers who were pilfering and stealing money from the pension fund,” charged Sen. Richard Onyonka (Kisii), who attended the session as a friend of the committee.

Records tabled showed that signatories to the contested account included senior administrators, among them the then-Acting Vice-Chancellor, Prof. Francis Aduol—raising suspicions of collusion at the university’s highest levels.

Embu Senator Alexander Mundigi demanded that Prof. Aduol be compelled to appear before the committee.

Prof. Mutua, under intense questioning, conceded culpability.

“We accept that the law was broken,” he admitted, though he attributed the failure to remit deductions to financial strain and bureaucratic hurdles.

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Questions to RBA

Murang’a Senator Joe Nyutu turned the spotlight on oversight bodies

Nyutu questioned whether the RBA raised concerns when they realized TUK was not remitting deductions.

“When you discovered deductions were not being remitted, did you make any recommendations? Where is the hope for employees who suffered these deductions?” he asked.

RBA responded that the matter had been escalated to the line ministry and the University Council before the scheme was declared insolvent and wound up.

Onyonka called for a full forensic audit to trace the billions lost and hold the culprits accountable.

Meanwhile, Prof. Mutua is expected to present a roadmap outlining how the university intends to compensate affected pensioners and safeguard those approaching retirement.

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