County Pension Fund Posts Impressive Growth in 2018

Thursday 27, June 2019:The County Pension Fund (CPF) has announced significantly improved financial performance in 2018 with increased assets and membership despite delay in remittances by counties.

CPF Chief Executive Officer, Hosea Kili, OGW told shareholders and key stakeholders at the firm’s Annual General Meeting (AGM) held at Pride Inn Paradise Beach Resort, Convention Centre & Spa in Mombasa that all the three schemes it administers namely, Local Authorities Pension Trust (Laptrust); the County Pension Fund, and the CPF Individual Pension Scheme recorded impressive growth.

In 2018, the Local Authorities Pension Trust (Laptrust Defined Benefits Scheme) fund value grew to Kshs. 27.65 Billion from 26.5 Billion in 2017. The scheme also realized an increase in the overall return on investment to Kshs. 2.1 Billion during the period, up from Kshs. 1.4 Billion in 2016. As at December 31st 2018, the scheme’s active membership stood at 20,074 compared to 20,936 in the previous year. This difference is attributable to exits from service (retirement) as well as natural attrition. The scheme’s pensioners and beneficiaries subsequently increased from 6,415 to 7,098 in the reporting period.

The County Pension Fund scheme posted an increase in Fund Value to Sh. 6.87 Billion in the year ended December 31st, 2018 from Kshs 4.75 Billion in 2017, with a fast-growing membership of 36,125. MeanwhileSalih,a Shariah-compliant pension product launched last year, posted a net return of Kshs. 983.54 Million with new members peaking at 6,066 as at 31stDecember, 2018.

The CPF Individual Pension Plan (IPP) fund value of the scheme stood at Kshs. 926,472,000 as at 31st December, 2018 compared to Kshs. 645,612,000 in 2017. Active membership grew from 4,867 in the year ended 31st December, 2017 to 5,989 in the year ended 31st December, 2018.

CPF CEO noted that low pension coverage, huge pending debts unremitted to pension schemes, economic and regulatory factors continue undermine business.

Cabinet Secretary for Devolution and ASAL’s, Hon. Eugene Wamalwa, who was chief guest at the event, agreed that public policy must be reviewed to enable retirement benefit schemes to support government projects such as the Big 4 Agenda. Hon. Wamalwa said: “Pension schemes have contributed immensely to development. Retirement benefits funds are preferable because they tend to be available for the long-term.”

CPF CEO, Mr. Hosea Kili also announced that the Retirement Benefits Authority (RBA) had approved a change of name of the Umbrella Fund to County Pension Fund. The CEO noted that the change of name is important as now counties can identify with their scheme.

“I am very pleased to note that after this lengthy process, we have finally made some progress in way of the change of name,” said Governor James Ongwae, who also serves as the Chairman, Human Resource, Labour & Social Welfare Committee in the Council of Governors.

“We are happy that the RBA has recognized this and granted this scheme the change of name. We shall be making a further request for the amendment of the Trust Deed & Rules to allow counties to have proper representation in the Board of Trustees, in line with the RBA Act; to allow for employer and employee representation in the top decision making organ of the scheme,” said the Governor of Kakamega County and Council of Governors chairperson, Hon. Wycliffe Oparanya; who was also in attendance at the event. 

The CS hailed CPF for its impressive performance despite a tough financial year characterized by a general subdued performance in the Financial Sector. The AGM was attended by over 1,000 delegates from all the 47 counties.