The government has denied reports that MPs will receive Sh160 million each in send-off allowances in 2015. Cabinet Minister William Lukuvi yesterday described the reports as baseless and misinformed.
But the controversy refused to die even as Mr Lukuvi, a minister of State in the Prime Minister’s office in charge of Policy, Coordination and National Assembly, explained the government’s position.
The minister’s intervention came as another MP wrote to The Citizen on Sunday, claiming Parliament may have created a loophole to grant the legislators the dream take-home golden handshake.
According to the MP, who did not want to be named, the National Assembly violated The Political Service Retirement Benefits Act in 2010 by granting the MPs a non-existent disturbance allowance pegged at 40 per cent of their gratuity earnings.
In addition, the MP said, all those who served in the last Parliament earned 20 per cent more in their “winding up allowance”, bringing the total to 60 per cent instead of 40 per cent as provided for in the law.
“The MPs who finished their term in 2005 earned Sh20 million each in gratuity, as the law stipulates,” the MP noted. “But come 2010, each MP received a total of Sh72 million.”
She explained that the amount shot up considerably because the law was shunted aside after payment of the normal gratuity of 40 per cent of their earnings over the five-year period. The MPs then landed another 60 per cent of gratuity as winding up allowance and another 40 per cent as disturbance allowance, she wrote, claiming the changes were proposed by Parliament’s Steering Committee and approved by the government.
But Mr Lukuvi was adamant that the law governing gratuity payment had not changed. He added: “Let anyone with the evidence reveal it…the payment of gratuity is in accordance with the law. When was that law changed? I sit in the Parliamentary Steering Committee and the parliamentary commission. There is no one time that this matter was brought up…it is mere speculation.”
The minister said neither the government nor parliament had thought of repealing the Act, considering the country’s economic situation. “The changes in the Political Service Retirement Benefits Act of 1999 can only happen if the Political Leaders’ Pensions Act of 1981 is also amended,” Mr Lukuvi added.
He confirmed that 40 per cent of MPs’ salaries over the period of five years will remain the basis for calculating gratuity earnings in the current Parliament. The basic salary of an MP is currently pegged at Sh3.4 million. When allowances are factored in, the gross amount comes to slightly over Sh11 million.
Critics are calculating the higher gratuity using the gross income as opposed to basic pay, the minister added.
The relevant sections of the law states: “The former Member of Parliament shall in addition to the benefits granted under subsection (1) be granted a winding up allowance of a sum equal to 20 per cent of the total sum of the salaries he received in 24 months.”
According to section 21 (1) of the Political Service Retirement Benefits Act, a leader who held the office of Parliament shall, upon ceasing to hold the office, be granted gratuity of a sum equal to 40 per cent of his salary for each complete month of his service, payable in lump sum.
The minister’s position is not helped by the fact that some MPs have secretly admitted to having taken their pay-off well in advance. An MP who did not want to be named said he has already received the Sh80 million allowed.
The new minister for Finance, Ms Saada Mkuya, confirmed the new pay but Mr Lukuvi responded that he had been in touch with her and she had denied saying anything of the sort.