Unremitted pension deductions hit Sh85.2billion in the year ended December 2025, up from Sh69.4billion at the close of the previous year, signaling deeper woes for retirees.

The unpaid deductions represent money already withheld from workers’ salaries but not remitted to pension schemes, delaying investment and eroding retirement savings.

Data from the Retirement Benefits Authority (RBA) shows the increase was driven largely by contributions overdue for more than 30 days—which rose to Sh73.1 billion in 2025 from Sh69.4 billion a year earlier.

Read: Anxiety as unremitted deductions, staff benefits jump by Sh14bn

"Unremitted contributions, especially those overdue by more than 30 days, accounted for most of this balance each year. By 2025, these unremitted contributions reached Sh73.14 billion, nearly tripling from Sh25.35 billion recorded in 2021," the RBA said.

The data further shows that contributions due less than 30 days fell slightly in the year under review from Sh14 billion to Sh11 billion.

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Occupational pension schemes accounted for the largest share of the overdue contributions at Sh63.8 billion, representing more than four-fifths of all arrears older than 30 days.

Umbrella schemes followed with Sh4.2 billion, while statutory schemes accounted for Sh5.2 billion.

Defined contribution schemes carried the biggest burden, with Sh66.5 billion in contributions overdue for more than a month.

Pension schemes accounted for Sh44.3 billion of the arrears, while provident funds made up Sh28.8 billion.

The surge in unremitted pension contributions comes as the government moves to tighten enforcement against employers who deduct workers' retirement savings but fail to remit them to pension schemes.

Under the proposed Kenya Revenue Authority (Amendment) Bill, KRA will be empowered to recover unremitted pension contributions using the same enforcement powers it applies to tax defaulters.

These include freezing bank accounts, issuing agency notices, seizing assets, restricting access to funds and deactivating tax PINs of persistent defaulters.

The RBA has argued that stronger enforcement is necessary because existing penalties have failed to stem the rise in unpaid contributions.

The regulator has also proposed higher fines and tougher sanctions, including holding CEOs and accounting officers personally liable for persistent defaults.

Read: Counties hold Sh44bn unpaid workers' dues for more than 3 years

Kenyan law requires employers to remit both employees' pension deductions and their own contributions to retirement schemes within the prescribed timelines.

Employers who fail to comply face penalties, enforcement action and possible recovery of the outstanding amounts by the RBA and KRA.

A Retirement Benefits Authority (RBA) banner. RBA has made new proposals to curb the non-remittance of pension deductions.

Photo credit: File

Pension deductions that remain with employers are not invested by retirement schemes, denying employees years of compounded returns and reducing the value of their retirement savings.

The problem is most acute in public institutions, particularly county governments, public universities and other State agencies, where delayed Treasury disbursements and budget constraints have contributed to chronic non-remittance despite deductions already having been made from workers' salaries.

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emwenda@ke.nationmedia.com