Current pension scheme (PSPS) versus The new contributory pension scheme (PSSS)
Cs Treasury (left) and president Uhuru Kenyatta

Current pension scheme (PSPS) versus The new contributory pension scheme (PSSS)

S/ No Current pension Scheme The new Contributory Scheme
1. Retirement benefits are paid on a set formula Retirement benefits are paid from the accrued contributions and investment income
2. Not  portable since accrued benefits are not transferrable Portable since accrued savings are transferrable
3. Pension Vesting period is 10 years and on attainment of 50 years of age Vesting period is 5 years with  no  age limit
4. There is no  employee participation Employees participate through representation in the Board of Trustees and Annual General Meetings
5. Payment of the benefits is from the Consolidated Fund. Payment shall be from the Fund
6. Pension commutation is limited to a ¼ of the accrued pension Pension commutation is limited to a 1/3 of the accumulated credit
7. Dependant pension payment is prescribed and paid only to a

widow and children

Annuity is paid as per principal member preference.
8. Managed by the National Treasury Administered by a Board of Trustees and regulated by the Retirement Benefits Authority
9. The accrued retirement benefit cannot be accessed while in service, hence not applicable for personal development. Allows a member to access 40% of the accrued savings to purchase a residential house.

Members can  access their accumulated savings upon exit subject to the vesting period

10. Employee does not contribute Employee contributes  promoting a saving culture
11. Benefits are defined and cannot be enhanced Employee  can  enhance the benefits through additional voluntary contributions


Teachers and other civil servants should note the following about the new contributory pension scheme (PSSS), which will be rolled out with effect from January 1st 2021

  • Officers below 45 years will automatically join the Scheme w.e.f.  1st January, 2021.
  • Employees aged 45 years and above may opt to join the scheme by completing the option A window of three months with effect from 1st January 2021 is provided to exercise the option.
  • Employee who will not exercise the option shall remain in the Public Service Pension Scheme as provided for under the Pensions Act, Cap
  • Employees serving on Temporary Terms of service and contributing to NSSF will be automatically converted to Permanent and Pensionable terms of service and shall cease contributing to NSSF with effect from 1st January, Upon conversion of the terms of service they shall be processed in accordance to the three categories above.
Read also:

KUPPET Branch Threatens To Strike In January

Male Teachers’ January 2021 Salary Scales After Stopping WCPS Deductions

Teachers’ January 2021 Basic Salary Scales After Pension Deductions

A High School Teacher To Face Attempted Murder Charges Over Failed Attempt To Kill Machakos Senator

Teachers’ Basic Salary Scales After Phase 2 of Pension Deductions

Teachers’ January 2021 Basic Salary Scales After Pension Deductions

Quick Facts about the January Contributory Pension Scheme As WCPS Contribution Ends 

  • Members of the new contributory scheme shall complete beneficiary nomination
  • Contributions to WCPS shall automatically cease upon joining the new contributory The contributions to this scheme shall be refunded upon exit from service.
  • The current pension scheme shall be closed to new entrants with effect from 1st January,
  • Authorized Officers shall deduct 2% of the employees’ basic salary and remit the same to the fund by the 10th day of the subsequent Any delay to remit the contributions will attract penalties.
  • Employees joining the new contributory scheme shall be issued with a letter recognizing their period of service under the current pension The   benefits shall be accessed through the fund upon retirement.
  • Widows and Children’s Pension Scheme (WCPS) and NSSF contributions will cease immediately an employee joins the new contributory s
  • Employees aged below 45  years who are on   secondment to other government agencies shall automatically join   the new contributory scheme and contribute 2% of the basic salary based on salary scale of the seconding The government contribution of 15% of basic salary shall be remitted by the respective Agencies. Employees aged 45 years and above will exercise the option to join the PSSS. The 31%Pension contribution will automatically cease.
  • Employees whose services were transferred from the National to the County Government owing to devolution of functions will automatically join the scheme and contribute 2% of the basic salary.

Support us

Thanks for reading our article. Funds From this blog goes towards needy children. Kindly Support them by clicking the button below:


Please enter your comment!
Please enter your name here