Capital FM (Nairobi)

12 December 2012

Kenya: MPs Delete Clause On Sh9 Billion Gratuity

Nairobi — Parliament has deleted a clause in the Finance Bill to award themselves a Sh9.3 billion gratuity.

Finance Minister Robinson Githae said that the clause proposed by Wajir West MP Adan Keynan during the Committee Stage, has stalled the Bill, which seeks to empower the Treasury to collect taxes proposed in the 2012/13 Budget.

He said he needed the new taxes to come into effect so that he can pay for the teachers, nurses, doctors and university lecturers' increment, which the government had agreed upon.

"Therefore it is important that we pass this, so that we can be able to collect these taxes, but for the other issues there are certain discussions that are going on and I hope by next week I will have finalised them."

President Mwai Kibaki said that he could not sign the Bill in October because the clause usurped the powers of the Salaries and Remuneration Commission.

Only Medical Services Minister Professor Anyang' Nyong'o and Lari MP David Njuguna contributed before the 20 MPs who were in the Chamber to vote on the issue.

"All of us know that this is a very important issue. The minister (Githae) has done a very good job, he is always responsive and listening to the House so I think we should give him the support," said Nyong'o.

"Mine is to thank the president for guiding this House during that critical moment when there were cries from the Kenyan people," Njuguna added.

MPs who've vowed to defy the President's memo must raise a two-thirds majority (148 Members) to retain the increased winding up package.

The controversial clause states that a severance allowance be paid to each MP at the rate of 31 percent of the gross taxable income payable each month, including the salary and allowances for constituency, nominated members, ex-officio members, house allowance, extraneous, transport, entertainment and vehicle fixed costs.

MPs could still get the send off package increased after it emerged that the government will be sponsoring an amendment to the Presidential Retirements Benefits (Amendments) Bill 2012, when the AG presents Miscellaneous Amendment Bill in the House.

In its amendment to the law that stipulates the current entitlement enjoyed by a retired president during their lifetime, Treasury proposed for huge retirement benefits for the President, the Prime Minister and Vice-President.

Also to benefit are the Speaker, Deputy Speaker, Chief Justice and Deputy Chief Justice.

Treasury and the Salaries and Remuneration Commission are said to have met and deliberated on the provisions and observed that although the proposals may cost more, the review is modest.

However, the Commission sought clarification over whether the Act will also apply to the former president who is currently enjoying benefits as provided for in the Presidential Retirements Benefits Act, Cap 11.

The Committee noted that the Government structures are bound to change with the devolved government and it is prudent to only handle the benefits for existing offices such as Prime Minister, Deputy Prime Ministers, Vice-President and Speaker; positions that currently do not have a retirement package.

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