The County Assemblies Pensions Scheme (Senate Bill No. 14 of 2024)

REPUBLICOFKENYA

PARLIAMENT

SENATEBILLS

(Bill No. 14 of 2024)

THE COUNTY ASSEMBLIES PENSIONS SCHEME BILL, 2024

(A Bill published in the Kenya Gazette Supplement No. 56 of 7th February, 2024 and passed by the Senate, with amendments, on 15th April, 2025)

THECOUNTY ASSEMBLIESPENSIONSSCHEMEBILL,2024 ARRANGEMENTOFSECTIONS

Section

• 1—Short title.
• 2—Interpretation.
• 3—Objects and purpose of the Act.

PARTII-ESTABLISHMENTOFTHECOUNTYASSEMBLIES PENSIONSSCHEME

• 4—Establishment of the CountyAssembliesPensionScheme.
• 5—Membership oftheScheme.
• 6Boardof TrusteesoftheScheme.
• 7Qualifications for appointment ofTrustees.
• 8-Disqualification from appointment as a Trustee.
• 9—Tenure of office.
• 10—Removal from office.
• 11—Vacation ofoffice.
• 12—Filling of vacancy.
• 13—Functions of the Board.
• 14—Powers oftheBoard.
• 15—Committees of the Board.
• 16—Remuneration ofTrustees.
• 17—Meetings of the Board.
• Chief Executive Officer of the Scheme.
• 19—Employees of the Scheme
• 20-Common seal of the Scheme.

PARTIII-ADMINISTRATIONOFTHESCHEME

• 21—Fund manager.
• 22—Custodian of the Scheme.
• 23—Administrator.

PARTI-PRELIMINARY

• 24Contributions.
• 25—Vestingofbenefits.
• 26—Withdrawal of membership or benefits.
• 27—Retirement from service.
• 28—Early retirement.
• 29—Payment of retirement benefits.
• 30—Particulars of member and dependants of the member.
• 31—Dispute on nomination.
• 32—Benefits to be paid upon the death of a member.
• 33—Death of member in service.
• 34—Presumption of death of member.
• 35—Death of member in retirement.
• 36—Prohibited payments from the Scheme.

PARTIVFINANCIALPROVISIONS

• 37—County Assemblies Pensions Scheme Fund.
• 38—Sourcesoffunds.
• 39—Reserveaccount.
• 40—Annualestimates.
• 41—Accounts and audit
• 42—Financial year.
• 43-Annual distribution of profits.
• 44—Actuarial reviewoftheScheme.

PARTV-MISCELLANEOUSPROVISIONS

• 45—Conflict with other written law.
• 46—Duty of care.
• 47—Exemption from compliance with provisions of this Act.
• 48—ProvisionsoftheRetirementBenefitsAct
• 49—Protection from personal liability.
• 50—Offences.
• 51—Proceedings for recovery of deductions from sponsors.
• 52—General penalty.

• 53—Regulations.

PARTVI-SAVINGSANDTRANSITION

• 54—Transition of members of county assemblies to theScheme.
• 55—Governmentguarantee.

SCHEDULE-THECONDUCTOFBUSINESSANDAFFAIRSOF THEBOARD

THE COUNTY ASSEMBLIES PENSION SCHEME BILL, 2024

AN ACT of Parliament to provide for a contributory pension scheme for members of county assemblies; establish a county assemblies pensions fund for the payment or granting of pensions or retirement benefits to members of county assemblies; and for connectedpurposes.

ENACTED by the Parliament of Kenya, as follows-

PARTI-PRELIMINARY

1. This Act may be cited as the County Assemblies Pension Short title Scheme Act, 2024.

2. In this Act, ——

Interpretation.

"actuary" has the meaning assigned theretoin theNo.3 of1997. RetirementBenefitsAct,Cap.197;

"administrator" means the person appointed as such under section 23;

"annuity" means a pension purchased under a contract with a registered insurer;

"approved issuer" means an approved issuer appointed by theTrusteeto providetheservicesof approvedissuer in accordance with the Retirement Benefits Act, Cap.197;

"Authority" means the Retirement Benefits Authority established under the Retirement Benefits Act, Cap.197;

"beneficiary" means a dependant, a person nominated by the member in writing or any other person other than a member entitledtoreceiveabenefit;

"Board" means the Board of Trustees established under section 6;

"Cabinet Secretary" means the CabinetSecretary responsible for the National Treasury;

"child" means any child of a deceased member including a natural child, an adopted child or a step-child who has not attained eighteen years of age or,if the child is receiving full time education,not more than twenty-five years of age and was atthetimeof thedeathof thedeceasedwhollyor mainly dependenton thedeceased,andincludesanunbornchildwho,if already born,would have been a child of the deceased;

"commencement date" means the date of coming into force ofthis Act;

"contribution"means the amount payable by a member or sponsor into the Scheme under this Act;

"county assembly" means a county assembly established underArticle176 ofthe Constitution;

s s serviceboardestablishedunder section12of theCounty Governments Act (Cap. 265);

"custodian" means a person appointed as such under section 22 of the Act;

"dependant" in relation to a deceased member, means a relative of the deceasedwho survivesthe deceased andwho,on thedate ofthe deceased's death,was

• (a) a spouse to the deceased;
• (b) a child of the deceased;or
• (c) a parent of the deceased who was dependent on the deceasedfor theprovision of the ordinary necessities of life;

"early retirement age" means such age as may be prescribed but which shall not be less than fifty years;

"existing scheme" means the Local Authorities Provident Fund, the Local Authorities Pension Trust, the Local Authorities Pension Trust (Defined Benefits) Scheme and the Local Authorities Pension Trust (Umbrella) Retirement Fund;

"Fund"means the County Assemblies Pensions Scheme Fundestablishedunder section37;

n ns e pe d e s p, section 21;

"income drawdown" means an arrangement that allows a member of a retirementbenefits scheme toaccesshis or her accumulatedretirementbenefits asaregularincomethrough reinvesting his or her benefits from an income drawdown fund registered bytheRetirementBenefitsAuthority;

"insured benefit"means the death in service lump sum n n s terms of section 24;

"investment return" means a portion of the return of the investment declared by the Board and appropriated to the account ofamember;

"member" means an eligible member of a county assembly whohasbecome a memberof theScheme and includes a person entitled toor receiving a benefit under theScheme;

"member account"" means an account maintained by the Scheme for an individual member;

"member of a county assembly"" means a member of a countyassemblyestablishedunderArticle176ofthe Constitution;

"normal retirement age" means the age of sixty years or such other age set out in written law or applicable policy;

"pensionable emoluments" means basic salary excluding housing, transport and any other allowances or fluctuating emoluments;

"Scheme" means the County Assemblies Pension Scheme established under section4;

"sponsor" means a county assembly service board that makes contributions onbehalf of a member;

"spouse" means a husband or a wife; and

• "Trustee" means a member of the Board.

3. (1) The object and purpose of the Act is to

• (a)provide for the establishment oftheScheme;
• (b) provide for the payment of retirement benefits to members ofthe Scheme when they become due;
• (c) provide for the social security of members of the Scheme by ensuring that the members save in order to cater for their livelihood during their retirement;
• (d) establish a uniform set of rules, regulations and standards for the administration and payment of retirement benefits for members of the Scheme;
• (e)establish transitionalprovisionsfor existing schemes;

Objects and purpose of theAct.

and

• (f)protect thebenefits of the members of the Scheme.

PARTII—ESTABLISHMENT OF THE COUNTY ASSEMBLIESPENSIONSSCHEME

• 4.(1) There is established the County Assemblies Pension Scheme.
• (2) The Scheme shall be a defined contribution scheme scheme. providing—

Establishment of the County Assemblies Pension

• (a) periodic payments through the purchase of annuities;
• (b) a lump sum as a commutation of pension or trivial pension in accordance with the Retirement Benefits AuthorityRegulations;
• (c) income drawdown;
• (d) gratuity; and
• (e) any other benefit approved by the Board under this Act.
• 5.(1) Membership of the Scheme shall consist of all Membership ofthe members of county assemblies. Scheme.
• (2)All members of the third county assemblies shall,on the dateofcommencementof thisAct,bedeemed tohavejoined the Scheme.
• 6 (1) The management of the Scheme shall vest in a Board Board of Trustees of ofTrusteesoftheScheme. theScheme
• (2) The Board shall be a body corporate with perpetual succession and a common seal and shall, in its corporate name, be capableof
• (a) suing and being sued;
• (b) taking, purchasing or otherwise acquiring, holding, charging or disposing of movable and immovable property;
• (c) entering into contracts; and

• (d)doing orperformingallother things or actsfor the furtherance of the provisions of this Act which may be lawfully done or performed by a body corporate.
• (3) TheBoard shall consist of-
• (a) the chairperson elected by the Trustees from among the members under paragraphs (c) and (d);
• (b)a countyexecutivecommitteemember responsiblefor matters relating to Finance nominated by the County Council of Governors;
• (t) three people nominated by County Assembly Service Boards;
• (d)five persons nominated by the forum representing all the county assembliesinthe countryofwhom at least twoshallnotbeofthesamegenderasfollows-
• (i) three representatives of members of county assemblies contemplated in Article 177(a) of the Constitution;
• (ii) a representative of members of county assemblies contemplated in Article 177(b)of the Constitution; and
• (i)a representative of members of county assemblies contemplated in Article 177(c) of the Constitution;
• (e)theChief Executive Officerwhoshall be an exofficio member and the secretary to theBoardwith novoting rights.
• (4) The vice-chairperson of the Board shall be elected by the Trustees from among their number.
• (5) The chairperson and vice- chairperson shall be of the opposite gender.
• (6)The CabinetSecretaryshall ensure thatnot more than two thirdsofthemembers oftheBoard areof thesamegender.

• (7) The Cabinet Secretary shall appoint the persons nominated under subsection (2) by notice in the gazette.

2. (8)The procedure for nomination and appointment of Trustees under subsection (2) shall be as prescribed in the regulations. 7. A person is qualified for appointment as a Trustee if that Qualifications person-- 4. (a) is a citizen of Kenya; 5. (b) holds a degree from a university recognized in Kenya; 6. (c)has at least five years experience in— 7. (i) finance; 8. (ii) law; 9. (iii) economics; 10. (iv) actuarial science; or 11. (v) anyotherprofessionorworkexperiencedirectly relevanttothefunctionsoftheBoard;and 12. (d)meetstherequirementsof leadership andintegrityset out in ChapterSix of the Constitution. 13. s ss e s pe q nu rs ud sa person—- 14. (a) has been convicted of a criminal offence, and sentenced to imprisonment for a term of six months or more; 15. (b) is an adjudged bankrupt or enters into a composition or arrangement with creditors; or 16. (c)is disqualified under the provisions of any other written law from appointment as such.

Tenureof office.

• 9.(1) A Trustee shall hold office for a term of three years and may be eligible for re-appointment for a further and final termofthreeyears.
• (2)The Cabinet Secretary shall put in place arrangements to ensure that one-third of the Trustees are appointed in a staggered

onfrom appointment as aTrustee.

appointment of Trustees.

manner.

10.(1) A Trustee maybe removed from office by the Cabinet Secretary, in consultation with the nominating body, for—

tRemoval fromoffice.

• (a)inability to perform the functions of the office arising out of physical or mental incapacity;
• (b) gross misconduct or misbehaviour;
• (c) incompetence or negligence of duty;
• (d) bankruptcy;
• (e)absence from twoconsecutive meetings of theBoard without a reasonable explanation; and
• (f)failure tomeettherequirementsofleadershipand integrity set out in chapter six of the Constitution.

(2)BeforeaTrusteeisremovedfromofficeundersubsection (1), the Trustee shall be given an opportunity to be heard against theintendedremoval.

(3) Notwithstanding subsection (1), the Authority may remove a Trustee on grounds specified in the Retirement Benefits Act, Cap. 197.

• 11.Aperson ceases tobe a Trustee if theperson—
• (a) resigns in writing to the Cabinet Secretary;
• (b)is convicted of a criminal offence and sentenced to a term of imprisonment of six months or more;
• (t) is declared bankrupt or enters into composition with his or her creditors;
• (d)isunable toperformthefunctions of their office by reason of mental or physical infirmity;
• (e) ceases to be a member of a county assembly;
• (f) is removed in accordance with section 10;
• (g) dies; or
• (h) term expires.

12. Where a vacancy occurs in the membership of the Board Filling of undersection10or11,theCabinetSecretaryshallappointanew vacancy.

Vacationof office.

Trustee in accordance with the provisions of this Act.

13.The Board shall—

• (a)formulate policies relating to theScheme in accordance with the provisions of the Retirement Benefits Act, Cap.197;
• (b) collect contributions and income payable to the Fund under thisAct;
• () pay out the various benefits to persons entitled to the benefits as provided under theAct;
• (d) protect the Fund's assets and ensure long term viability of the Scheme;
• (e)ensure efficient management of the Scheme;
• ensure prudent investment of the monies forming part of the Fund;
• (g)ensure that theSchemeobserveshighstandards of corporate and business ethics;
• (h) advise the Cabinet Secretary on any matter relating to the objects and functions of the Board under this Act; and
• (i) perform any other functions assigned to it under this Act.

14. (1) In the exercise of its functions, the Board shall be Powers ofthe Board. accountableto thesponsors and themembersoftheScheme.

(2) The Board shall have all powers necessary for the proper performance of thefunctions of theScheme under thisAct.

(3) Without prejudice to the generality of subsection (2), the Board shall have power to-

• (a) supervise the assets of the Scheme in such manner as best promotes the purpose for which the Scheme is established;
• (b) appoint a custodian, fund manager and administrator to carry out their functions asspecified in theRetirement Benefits Act, Cap. 197;
• (c)determine theprovisions tobe madefor administrative expensesasprovidedfor under section38andfor reserves of the Fund as provided for under section 39;

Functions of the Board.

• (d) ensure protection,where necessary, of the assets of the Scheme;
• (e)associatewith anyotherinstitution so as tofurther the purpose for which the Scheme is established;
• )receivegrants,gifts,donations orendowments andmake legitimate disbursementsfrom them;
• (g) enforce remittance of outstanding Contributions by a sponsor;
• (h) invest any monies of the Scheme not immediately required for its purposes;
• (i)delegate any of its powers; and
• G) undertake any activity necessary for the fulfilment of any of the functions of the Scheme.
• (4) The Board may, subject to such conditions as it may consider necessary, by directions in writing, delegate any of its powerstoanyoneormoreof theTrusteesor tothechief executiveofficeroremployeesoftheScheme.

15. (1) The Board may establish committees consisting of Commitees the Trustees for the better carrying out of its functions. of theBoard.

• (2) The Board may co-opt persons to committees established under subsection (1) for a particular reason and such persons shall hold office for such period as the Board may determine.
• (3) The persons co-opted into a committee under subsection (2) shall not be more than three.
• (4) Subject to any specific or general direction of the Board, a committee established under subsection (l) may regulate its own procedure.

16. The Trustees shall be paid such remuneration as the Remuneration AuthoritymaydetermineinaccordancewiththeRetirement ofTrustees. BenefitsAct.

• 17.(1) The business and affairs of the Board shall be Meetings of the Board. conductedinaccordancewiththeSchedule.
• (2) Except as provided in the Schedule, the Board may regulateitsownproceduressubjecttocompliancewiththe

RetirementBenefitsAct and the regulations thereunder.

(3) The Board may invite any person to attend any of its meetings and to participate in its deliberations,but such person shall not have a vote in any of its decisions.

18.(1) There shall be a chief executive officer of the Chief Scheme who shall be appointed by the Board through a oficrofte executive competitive recruitment process on such terms and conditions as Scheme. maybe specified in the instrument of appointment.

(2) The chief executive officer shall be an ex-officio member oftheBoard.

(3) A person is qualified for appointment as the chief executive officer if thatperson——

• (a) is a citizen of Kenya;
• (b) holds a degree from a university recognized in Kenya;
• (c)has at least ten years of experience of which five years shouldbeatseniormanagementlevelin aprofession relevanttothefunctionsoftheSchemeasmaybe defined in theRegulations; and
• (d)meetsthe requirements of leadership and integrity set out in Chapter Sixof the Constitution.
• (4)The Chief Executive Officer shall be the accounting officer of theScheme andsecretaryto theBoard and,subject to the direction of the Board, shall be responsible for the
• (a) implementation of the decisions of the Board;
• (b) day to day management of the affairs of the Scheme;
• (c) management and discipline of the employees of the Scheme; and
• (d)any otherfunction that maybeassignedbytheBoard.

(5)The Chief Executive Officer shall hold officefor a term of three years and may be eligible for re-appointment for a furtherfinaltermofthreeyears.

(6)The Chief Executive Officer maybe removed from office by the Board such grounds as may be set out in the instrument of appointment.

(7)Before the Chief Executive Officer is removed from office under subsection (5), the Chief Executive Officer shall be given——

• her; and
• (b) an opportunity to be heard either in person or by a legal representative.

19. (1) The Board may engage such other employees as it Employees of the Scheme. mayconsider necessaryfor theperformance of itsfunctions under this Act.

(2) The terms and conditions of service of employees of the Scheme shall be determined by theBoard.

Commonseal ofthe Scheme.

20.(1) The common seal of the Scheme shall be kept in such custodyas theBoard maydirect and shall not beused exceptontheorderoftheBoard.

(2)The common seal of the Scheme when affixed toa document and authenticated shall be officially noticed,and unless the contrary is proved, an order or authorization of the Board under this section shall be presumed to have been given.

PARTIII-ADMINISTRATIONOFTHESCHEME

Fund manager.

21. The Board shall appoint a fund manager of the Scheme who shall, in addition to the duties prescribed under the RetirementBenefitsAct--

• (a) implementtheinvestmentpolicyof theSchemeas approved by the Board;
• b managetheSchemefundsand assetsinaccordance with theprovisionsoftheRetirementBenefitsAct;
• maintain books of accounts on all investment transactions relating to the Scheme;
• (d) submit reports on a quarterly basis on investment strategy, market returns and other performance indicatorstotheBoard;and
• e perform any otherfunction that may be assigned in the instrument of appointment and other written law.

eCustodianof theScheme.

22. (1) The Board shall appoint a custodian of the Scheme who shall,in addition to the duties prescribed under the RetirementBenefitsAct--

• a) receive the contributions remitted by the sponsors and members under this Act on behalf of the Board;

2. (b) not later than the next business dayfollowingreceipt of the contributions from a sponsor, notify the fund manager and the administrator of such receipt; 3. C receive and keep in safe custody the title documents, securities andmoniesof theScheme in trust for the members and beneficiaries; 4. (d) collect dividends for the Scheme; 5. (e) reporttotheBoardon anymatter relatingtothe assets beingheldbythecustodianon itsbehalf at such intervals asmayfrom time to timebedeterminedby the Board; 6. undertake statistical analysis on the investments and returnsoninvestmentswithrespecttofundsinits custodyandprovidedataandinformationtothe administrator and theBoard; 7. (g) submit totheBoard a report on a quarterlybasis,of the reconciliations with respect to the fundsheld by the Custodian; 8. (h) execute,onbehalf oftheBoard,therelevantproxy for the purpose of voting in relation to the investments; and 9. (i) s n o instrument of appointment or any other written law.

(2) The custodian shall maintain all funds and assets in its custody to the order of the Board and shall not utilise any pension fund or assets in its custody to meet its own financial obligation.

23. (1) The Scheme shall be administered by an Administrator administrator appointed by the Board.

(2)Thefunctions of the administrator shallbe to—

• (a) open and maintain an account for each member;
• (b) upon receiving details of the contributions remitted underthisAct,causetheamountofthecontributionsto becreditedin theaccountofthememberinrespectof whom the sponsor hasmade the payment;
• (c)informtheBoard ifa member's contributiondetails

differfrom theexpected;

• (d) provide customer support services to members, including access atleast on aquarterlybasisto members'account balances and statements;
• (e) keep and maintain proper books of accounts of the Scheme;
• (f)cause tobe paid retirement benefits toa member who has retired;
• (g)beresponsiblefor all calculationsrelating toretirement benefits; and
• Boardfromtimeto time.
• (3)Theadministratorshallensurethatallincomeearned fromtheinvestmentoftheFundisdistributedtothecreditof the members' retirement savings accounts save for clearly defined and reasonable fees, charges, costs and expenses of transactions as may be approved by the Board.

24. (1) A member shall, so long as the member is a member Contributions of a county assembly, contribute not less than seven nought five percent (7.5%) of that member's pensionable emoluments to the Scheme.

• (2) Every sponsor shall contribute to the Scheme not less than fifteen per cent of the pensionable emoluments of a member of the Scheme plus the amounts necessary to cover the premiums forinsured benefit.
• (3) Subject to such guidelines as theBoard may issue,in consultation with the members and sponsors of the Scheme, a member of theSchememaymake additional contributions to the Scheme.
• (4)Upon commencement of this Act,contributions required to be made under subsections (1) and (3) shall be deducted by a sponsor from the salary of the member in each month on which the salary ispaid and shallbepaid into theScheme togetherwith the sponsor'scontributionbeforethe tenthday ofevery calendar month or before any other day which may be notified in writing and approved by the Authority.
• within ten daysafter thelastdayof thecalendarmonthtowhich

the contributions relate,shall attract interest which shall not be less than theinterest declared during theperiod the contribution remains unremitted.

• (6)Allunpaidcontributionsandinterestthereonshall constitute a civil debt of the respective sponsor and shall be recoverable summarily by theBoard asprovided forbylaw.
• (7) The Board shall report to the Authority at such intervals as specified by the Authority,all remittances of contributions outstanding and not received after the deadlines specified herein.
• 25.All the benefits derived from contributions by a member and a sponsor shall vest immediately in the member.

Vesting of benefits.

Withdrawal of membership orbenefits.

• 26.(1)Amember shall not withdraw membership or retirementbenefitfrom theSchemewhilethememberisa member of a county assembly.
• (2)Amember maywithdrawbenefitsfrom their account beforenormalretirementageinthefollowing circumstances-
• a.1 resignation;
• b. dismissal;
• C. removal from office;
• d. ill health;
• e. emigration.
• (3) Despite subsection (1)—
• (a) where a member ceases being a member of a countyassemblybeforeattainingtheearly retirement age, that member may opt for payment of-

(i)not more than fifty percent of his total accruedbenefitsandtheinvestments income that has accrued in respect of those contributions provided that a member may withdrawany additional voluntary contributionsmadeintotheschemeand accruedinterestinfull;and

• (ii)the balance shall beretained in the

Schemeandcontinuetoaccrueinterest untilthememberattainsearlyretirement age,or transferred to another registered Scheme of the members choice;

• (b) amembermay optforpaymenttohim or herof thetotalamountofvestedaccrued benefits--
• (c) on grounds of ill health or subsequently during deferment,ifthemember becomes incapacitatedduetoillhealth,totheextent that it would occasion his or her retirement, if heorshewasinemployment;or
• (d) if the member has emigrated fromKenya to anothercountrywithouttheintentionof returningtoresideinKenyaandtheBoardhas approvedthepaymentoftheretirement benefits and submitted, fourteen days prior to payment of the benefits, the approval to the Authority.

27. (1) Despite any other provisions in this Act, a member whoretiresisentitledtomakewithdrawals

• (a)on attaining the normal retirement age,or where their exact date of birth is not known, on the first day of July in the year in which the Board deems that they have reached normal retirement age;
• (b) on the advice of a qualified medical practitioner appointed by the Board certifying that the member is no longer mentally orphysically capable of carrying out the functions of their office.
• (2) The proof of age of a retiring member for the purposes of subsection (1) is the date of birth in any of the following documents--
• (a) birth certificate;
• (b) national identification card; or
• (c) a valid passport.
• 28.(1) Notwithstanding the provisions of section 27,any memberwhoretiresonattainingtheearlyretirementageis

Retirement from service.

Early retirement.

entitled tomakewithdrawalsin accordancewithsection 29.

(2) The proof of age of a retiring member for the purposes of subsection (1) is the date of birth in any of the following documents—-

• (a) birth certificate;
• (b) nationalidentification card; or
• (C) a valid passport.

29. (1) Where a member retires as provided in this Act, the Payment of member may request the Board in writing to pay to him or her— retirement benefits.

• (a)a lump sumfrom the balance inhis or her retirement savings account that shallnotexceed the equivalent of one-third of that balance:

Provided that a Member may withdraw any additional voluntarycontributionsmadeintotheScheme and accruedinterestinfull;

• (b)monthly or quarterlyincome drawdown in accordance with a formula prescribed by the Board on the advice of an actuary;
• (c)monthly or quarterly annuity for life purchased from an approved issuer of their choice:

Provided that the annuity shall include a provisionfor benefits payable to dependants upon a member's death.

(2) Subject to the Retirement Benefits Act, a benefit granted underthisActshallnotbe—

• (a)assignableor transferableexceptinaccordancewith the Board; and
• (b) liable to be attached in settlement of any claim.

(3)Thepaymentof aretirementbenefitsshall commence from the end of the month immediately following the month of the retirement ofthe member.

(4)Everypayment of benefits from theScheme maybe subjecttodeductionof theamountoutstandingduebythe member under any mortgage guarantee facility approved by the Board.

30. (1) Every member shall provide his or her particulars Particulars of and those of his or her dependants tothe administrator in the member and dependantsof prescribed manner. the member.

(2)A member mayupdate theparticularsprovided under subsection (1) at any time and, in any event, at least three years beforeretirement.

31. (1) If a dispute relating to a nomination under this Part Dispute on arises,theBoardhaspower toconsiderevidencepresented and nomination. determine the rightful dependant.

(2) Nothing in this Part may be construed as limiting or otherwise affecting theinherent power of theBoard, either on its own motion or on the application of a party,to make such decisions as may be necessary.

32. If upon the death of a member, benefits are paid to a person'validly nominated under this Part, no other person shall have any other claim to thebenefits against theFund.

33. (1) Upon the death of a member, the benefits accrued to the member shall be paid to the person whose particulars the Member hadprovidedor at theBoard's discretion as otherwise provided in the Retirement Benefits Act and Regulations thereunder.

i. In the absence of a nomination, the Board shall apply the benefits referred toin subsection (1) to such of dependants of the deceased and in such amounts as theBoard shall determine.

ii. Where a dispute arises under this section, the Board shall consider any evidencepresentedbefore it and determine the rightful beneficiary.

Benefitstobe paid upon the deathofa member.

Deathofa member in service.

• 34.(1) Where a member is missing and it is proved that the memberhas notbeenheardofforsuchperiod asprescribed by the law relating to presumption of death by those who might be expected tohaveheardof themember if thatmemberwas alive, there shall be a rebuttable presumption that the member is dead as provided under thelaw.
• (2) Where a person is presumed dead under this section, theprovisions of section33 apply.

Deathof memberin retirement.

35. (1) If a member who was receiving a retirement benefit under an income drawdown dies,a benefit that is equivalent to theunutilizedbalanceofthe accountofthemembershallbepaid tothenominatedbeneficiariesofthemember.

• (2) The payment under subsection (1) shall be made to the beneficiaries either as a lump sum or as an annuity commencing from the day following the death of the member.

36. The retirement benefits under this Act shall not be paid Prohibited by the Scheme to 4. (a)a member,while the member is still a member of a contractual basis for theSponsor after theirresignation or early retirement; or 5. (b) anyperson as a loan,advance or other similar benefit orpaymentexcept asprovided under thisAct.

PARTIV-FINANCIALPROVISIONS

• 37.There is established the CountyAssembliesPensions SchemeFundwhichshallbeadministeredbytheBoardin accordancewith thisActandotherrelevantwrittenlaws.
• 38.(1) The Fund shall consist of—
• (a)monies asmayvest in or accrue to theSchemein the performance of its functions under this Act or under any other writtenlaw;

payments fromthe Scheme.

County Assemblies Pensions Scheme Fund.

Sources of funds.

Presumption ofdeathof member.

• ()grants, gifts, donations or other endowments given to the Scheme;
• (d) income from investments made by the Scheme that are approved by the Board;
• (e)fees and charges authorized by the Board;
• (f) monies earned by the Scheme from any other source; and
• (g) monies from any other source provided or donated or lent to the Scheme.
• (2) There shall be paid out of the Fund
• (a) all benefits provided for under this Act;
• (b)theexpensesincurredinthemanagementand administrationof theSchemesubject tothelimits provided under this section.
• (3)For the avoidance of doubt, nothing in this Act is intended to or may be construed as providing for or dealing with-
• (a) taxes;
• (b) the imposition of charges on a public fund or the variation or repeal of any of those charges;
• () the appropriation, receipt, custody, investment or issue of public money;
• (d) the raising or guaranteeing of any loan or its repayment except as providedin anywrittenlaw;or
• (e)matters incidental to any of those matters.
• (4) TheBoard shall establish an account intowhich may be paid—-
• (a) the monies transferred from the Fund for the trust expenses incurred by theBoard in the exercise of its powersortheperformanceofitsfunctionsunderthis Act;
• (b)the annual administrative expenses deductedfrom thevalueof theFund at the rate approved from time to timeby theBoardbut subjectto a maximum of one and half percent of the Fund value or any such rate as theBoard in consultationwith the Authority may prescribe;

• (c)monies that may vest in the Board in the course of theexerciseofthepowersoftheBoard;
• (d) income from the investment of the monies held in the account establishedunder thissection;and
• (e)all monies from anyother source provided for or donatedorlenttotheBoard.

(5) Any unspent monies budgeted for annual administrative expensesshall lapsebackinto theFund at the end ofthefinancial year.

(6) The Board may invest any surplus monies held in the accountestablished under thisAct in asset classes approved undertheRetirementBenefitsAct.

39. (1) The Board may maintain a reserve account of the Reserve account. Scheme intowhich thefollowing shall be deposited

• (a)anyspecialcontributionpaidintothe Schemebya sponsor or the Government for the purpose of improving the benefits of themembers;and
• (b) any income of the Scheme that the Board determines should be set aside tostabilize the returns to members subject toamaximum oftenper centofsuchincome withconsideration to theIncomeTaxActor regulationsCap.470 made thereunder.

(2)Money shall not be drawn out of thereserve account except as directedby theBoardfor thepurposesprovidedfor under subsection (1).

(3) Any monies determined tobe income of the reserve account shall be treated as income forming part of the general incomeoftheScheme.

40. (1) Before the commencement of each financial year, Aaual estimates. theBoardshall causetobeprepared estimatesoftherevenue and expenditureoftheSchemeforthatyear.

(2) The annual estimates shall make provision for all the estimatedexpenditureoftheSchemefor thefinancialyear concerned and, in particular, shall provide for the—

(a) payment of the salaries, allowances, and other charges inrespectoftheemployeeoftheScheme;

• (b)paymentofbenefitsandotherchargeswhichare payable out of the funds of the Scheme;
• () funding of the registration, monitoring and evaluation activities of the Scheme;
• (d) maintenance of thebuildings and grounds of the Scheme;
• (e) funding of training, research and development of activities of the Scheme;
• (f)reserve funds to meet future or contingent liabilities in relation to retirement benefits, insurance or replacement of buildings or equipment; and
• (g) such other matters as the Board may consider necessary.

(3) The annual estimates shall be approved by the Board before the commencement of the financial year to which they relate.

(4) Expenditure of the Scheme shall not beincurred except in accordance with the annual estimates approved by the Board.

41. (1) The Board shall cause to be kept proper books and Accounts and records of accounts of the income, expenditure, assets and audit. liabilities.

(2)Withinaperiodofthreemonthsafter theendofeach financial year, the Board shall submit to an auditor who is recognizedand approved by theAuthority the accountsof the Scheme in respect of that year together with—-

• (a)balance sheet showing in detail the assets and liabilities of the Scheme as at the end of the financial year.
• (b)astatementoftheincomeandexpenditureof the Scheme during that year; and
• (c) such other statements as may be required by the Authority.

(3) The annual accounts of the Scheme shall be prepared, audited andreporteduponinaccordancewiththeRetirement BenefitAct and other relevant laws.

42. The financial year of the Scheme shall be the period of Financial

year.

twelve months ending on the thirtieth June in each year.

• 43.The annual investment income earned bythe Scheme of the Scheme and any appropriation to a reserve account approved by the Board be credited to members' accounts on a pro-rata basis.

Annual distributionof

Actuarial reviewofthe Scheme.

• 44.(l)Theschemeshallbe reviewedbyan actuary appointed bytheBoardasprovidedforin theRetirement Benefits Act.
• (a)prepare a report on the stateof theScheme; and
• (b) recommend any necessary action to be taken.

(3) The actuaryshallsubmit the report preparedunder subsection(2) to the Board within the stipulated time in the instrument of appointment.

• (4) The Board shall,within six months of the receipt of such report, consider any recommendations made by the Actuary and in so doing, may take any action recommended by the actuary.

PARTVMISCELLANEOUSPROVISIONS

45. Where there is a conflict between the provisions of this Conflict with otherwritten Act and the provisionsof the Retirement Benefits Act,the law. provisions of theRetirementBenefits Act shall prevail. 46. (1) The Board shall 3. (a) ensure that the Scheme is at all times managed in accordance with the provisions of this Act, the Retirement Benefits Act and any other applicable law; and 4. (b)takereasonable caretoensure that themanagement of the Scheme or safe keeping of the assets of the Scheme is carriedoutin thebest interestsof themembersof the

Duty of care.

Scheme.

• (2)The administrator, fund manager, actuary and custodian shall--
• (a) report to the Board and the Authority,as soon as reasonably practicable,any unusual occurrence with respecttotheSchemewhichintheirviewcould adversely affect therightsof the owner of a member's account under the Scheme; and
• (b) report to the Board and the Authority,as soon as is reasonably practicable,if a sponsor has not remitted therequired contribution andsuch remittanceremains due for more than ten days.

47. The Cabinet Secretary may, by order in the Gazette—-

• (a) exempt any person or class of persons sfrom or

Exemption from compliance with provisionsof this Act.

• (b) extend the time for compliance by any person or class of persons with any specified provisions of this Act

provided that nothing in this section shall apply in respect of payment of retirement benefits.

48. The provisions of the Retirement Benefits Act and Provisions of regulations thereunder shall apply to the Fund.

the Retirement Benefits Act.

Cap.197.

Protection frompersonal liability.

49. No action or omission by any member of the Board, or employee of the Scheme shall,if the act was done in good faith for the purpose of carrying out the provisions of this Act or any other law,subject the person to any liability,action,claim or demand. 50. (1) A person who—

Offences.

• (a) wilfullyfailstoremitcontributions to theScheme as required;
• (b) knowingly gives false information to the Scheme; or
• (c) )being a Trustee or employee of theScheme,wilfully

misappropriates the assets of the Scheme,

commits anoffence and isliableonconviction toafinenot exceedingfivemillion shillingsor toimprisonmentfor aterm not exceeding five years or to both.

(2)Where an offenceunder this sectionis committed by a body corporate, every person who at the time of the commission of the offence was—

• (a)a director,general manager,secretary of the company or other similar officer of the body corporate; or
• (b) purporting to act in any such capacity as provided in paragraph (a),

commitsthatoffence.

(3) A person who is convicted of an offence under subsection (1) (c) shall, in addition to any fine that may be imposed,refund to the scheme threetimesthevalueof any lossthatmaybeincurred bytheschemebyreason of the commissionoftheoffence.

Proceedings forrecovery of deductions nfrom sponsors.

51. (1) Notwithstanding the provision of section 26, where a sponsor, having made deduction from a member's emoluments for remittance to the Scheme,fails to remit the contribution within fifteen days of the deduction,the Scheme shall,after giving such sponsor not less than seven days'notice,institute proceedings for the recovery of the deduction.

(2)A notice under subsection (1) shall be in writing and copied to theAuthority,and shall—

• (a)require the sponsor topay the sumdeducted to the Schemewithin sevendays ofthenotice;and
• (b) inform the sponsor that if he fails topay such sum before theexpirationof the notice,proceedings for summary recovery of the sum shall be filed in court withoutfurtherreferencetohim.

(3) Any sum which is the subject of proceedings of summaryrecoveryunderthissectionshall attract a compound interest at the rate of three per cent per month.

(4)Withoutprejudice to anyproceedings instituted under the provisions of this section, a sponsor who makes a deduction from a member's emoluments for remittance to the Scheme and fails toremit thecontribution totheSchemewithinfifteendays commitsanoffenceandshallonconvictionbeliabletoafinenot exceedingfive million shillings or in the case of a natural person to imprisonment for a term not exceeding two years or to both.

(5) Where an offence under subsection (4) is a continuing offence, the person convicted shall, in addition to the penalty prescribed in that subsection be liable to a further fine of one offence continues.

52. A person who-

• (a) contravenes anyprovisionof thisAct whichis expressly stated tobe an offencebutfor which no other penalty is prescribed; or
• (b) fails to comply with any direction given by the Authority,

commits an offence and is liable,on conviction,to a fine not exceeding one hundred thousand shillings,or to imprisonment for a term not exceeding one year, or to both.

53. The Cabinet Secretary may, in consultation with the Regulations Board, make regulations generally for the better carrying into effecttheprovisionsofthisAct.

PARTVI-SAVINGSANDTRANSITION

54. (1) A member of a county assembly who is a member of Transitionof membersof theLocalAuthoritiesProvidentFund,theLocalAuthorities county Pension Trust, the Local Authorities Pension Trust (Defined assembliesto Benefits)Scheme and the Local Authorities Pension Trust theScheme. (Umbrella)RetirementFundshallbetransitionedintothe Scheme within one year upon the commencement of this Act.

(2)The funds,assetsand other movable or immovable property which immediately before the commencement date wereheldbyoronbehalfoftheLocalAuthoritiesProvident Fund, the Local Authorities Pension Trust, the Local Authorities Pension Trust (Defined Benefits)Scheme and the Local Authorities Pension Trust (Umbrella)Retirement Fund for the members of county assemblies shall vest in theScheme.

(3)All the records of members of county assemblies held by theLocal AuthoritiesProvident Fund, the Local Authorities General penalty.

Pension Trust, the Local Authorities Pension Trust (Defined Benefits)SchemeandtheLocalAuthoritiesPensionTrust (Umbrella)RetirementFund shall be transferred to theScheme administrator.

(4) All rights,liabilities and duties whether arising under anywrittenlawor otherwise,whichimmediatelybeforethe commencement datewereaccruing,imposedor enforceableby or against the Local Authorities Provident Fund, the Local Authorities Pension Trust,theLocal AuthoritiesPension Trust (Defined Benefits)Scheme and theLocal AuthoritiesPension Trust (Umbrella)RetirementFundwithregard tomembers of county assemblies shall vest in,be imposed on,or be enforceable against theScheme.

55. County governments shall, during the short and medium term, guarantee the solvency of the Scheme for any payment that may be required under it.

Government guarantee.

SCHEDULE

(s.17)

THECONDUCTOFBUSINESSAND AFFAIRSOFTHEBOARD

Meetings

1.(1) The Board shall hold at least four meetings in everyfinancialyear and not more thanfour months shall elapsebetweenthedateofonemeetingandthedateof the next meeting.

(2)Meetings shall be convened by theSecretaryof the Board in consultation with the Chairperson and shall be held at such times and such places as the Chairperson shall determine.

(3)The chairpersonshall preside over allmeetings and in the absence of the chairperson, the vice-chairperson, or in the absence of the vice-chairperson, a Trustee elected by the Board at the meeting for that purpose, shall preside over the meeting.

meeting of the Board, and shall do so within seven days of the receipt by the chairperson of a written request signed by at least five other Trustees.

(5)Unless six Trustees otherwise agree,at least seven days'noticeofa meetingshall begivento every trustee.

2. (1). The quorum of a meeting of the Board shall be five Trustees present and voting and shall include at least two Trustees appointed under section 6 (2) (b), (c), (d) or (e) and at least three Trustees appointed under section 6 (2) (f).

Quorum.

(2)For special meetings, the quorum shall be six Trustees present and voting and shall include at least three Trustees appointed under section 6 (2) (b) or (c) and at least four Trustees appointed under section 6 (2) (d).

3. A decision of the Board shall be by a majority of Voting. the Trustees present and voting and, in the case of a tie of votes,the person presiding at the meeting shall have a secondorcastingvote.

4. Minutes of all meetings shall be kept and entered in Minutes. records kept for that purpose.

I certify that this printed impression is a true copy of theBill as passed by theSenateon15thApr,2025.

ClerkoftheSenate

Endorsed for presentation to the National Assembly in accordance with the provisions of standing order 161(1) of the Senate Standing Orders.

SpeakerofthgSenate