Retirees from the University of Nairobi (UoN) may face a grim future after years of dedicated service, with a recent audit revealing that the institution has failed to remit over Sh7.2 billion to its workers’ pension scheme. This financial mess leaves retirees potentially walking away empty-handed after their careers at one of Kenya’s top universities.
Auditor General Nancy Gathungu flagged the alarming anomaly in her review of the pension scheme’s books, which were last audited on June 30, 2024. According to the audit, UoN, as the main sponsor, owes the scheme a staggering Sh7,223,501,000, marking a Sh1 billion increase from the previous year’s balance. The contributions, dating back to November 2016, have yet to be settled, raising concerns about the university’s financial stewardship.
A remedial plan, approved in October 2019 by both the university council and the Retirement Benefits Authority (RBA), required UoN to remit Sh50 million every month to clear the arrears by September 2025. However, the plan has not been adhered to. In May 2020, the university management requested that the RBA suspend the monthly payments due to the closure of learning institutions following the Covid-19 pandemic. Despite this, as of September 2024, UoN had not provided a revised plan nor remitted the necessary contributions.
The audit also revealed that UoN had failed to comply with financial reporting standards, making it impossible to confirm the regularity and valuation of contributions owed to the pension scheme. This casts further doubt on the university’s ability to meet its financial obligations.
The financial turmoil extends beyond pension arrears. The university has struggled to collect rent from key assets, with Sh111 million in arrears from Ambank House and Sh4 million from Unipen apartments. Additionally, the pension scheme’s management faces scrutiny over a failed enterprise resource planning (ERP) system, resulting in a potential loss of Sh7 million.
Public universities in Kenya are grappling with a financial crisis, with debts totaling Sh60 billion, leaving no clear path toward recovery. As the University of Nairobi continues to struggle, retirees are left in uncertainty about their hard-earned benefits.
