MPs award themselves Sh2bn bonus in secret deal

MPs have secretly added a Sh2.1 billion severance pay to their already huge package.

The higher perks, approved on Thursday night, however came about as Finance Minister Njeru Githae increased taxes to raise the money required to meet public servants’ demands for better salaries.

In the last-minute changes introduced in Parliament on Thursday night, each of the 222 MPs and House Speaker Kenneth Marende will take home a minimum package of Sh9.3 million on January 15 next year when their term expires.

Meanwhile, a 10 per cent Excise duty will now be levied on mobile money transfers such as M-Pesa, making the services more expensive. The services are run by banks, money transfer agencies and mobile phone companies.

The minister also raised taxes on beer, wine and other alcoholic drinks to Sh70 per litre – or 50 per cent of the ex-factory price – and on raw hides and skins destined for foreign markets in a bid to revive and improve local tanneries.

Mr Githae also has his eye on the money made in the data market – through cable, the Internet, fibre-optic and satellite – seeking to tax “gains or profits made from the business of transmitting messages”.

The mining industry will also pay more taxes after the House allowed Kenya Revenue Authority to tax proceeds from the sale of property or shares, more so for oil companies, or other firms involved in mining or mineral prospecting.

The vice-chairman of the Parliamentary Service Commission (PSC), Mr Adan Keynan, sneaked in the amendments, as approved by the Finance minister, just moments before the House concluded putting final touches on the Finance Bill 2012.

Once assented to, the Finance Bill grants the taxman the licence to collect taxes in order to meet the government’s revenue targets as prescribed in the annual national budget.

Tellingly, the amendment was not in the Order Paper like the ones by the minister on raising taxes, and not all MPs had access to it even after it was tabled. There was no debate on the clause; it was just approved, unanimously.

The change will see the Treasury calculate the “severance allowance” at 31 per cent of MPs’ pay, including their hefty tax-free perks. The computation will be based on their basic pay of Sh200,000 and all allowances – except sitting allowance – amounting to Sh651,000.

The perks include house allowance, extraneous duty allowance, transport allowance, entertainment allowance, vehicle fixed cost allowance and constituency allowance. Each of the 12 nominated MPs also get an allowance; so do the two ex-officio members — the Speaker and the Attorney-General.

Second time in six months

This is the second time in less than six months that the lawmakers have raided the public coffers to line their pockets as they scrounge around in their brazen bid to raise money for the political campaigns ahead of the General Election.

On April 19, again in at dusk, they changed the law to raise the severance package – hitherto called “the winding-up allowance” – from Sh1.5 million to Sh3.72 million per MP. And just as then, this week’s Sh5.6 million addition was made through the Finance Bill.

The mischief of raising their perks through the Finance Bill ensures that MPs can do it at the eleventh hour, quietly, and since it has to do with taxes it is guaranteed that the President will have no option but to assent to it.

The law, once enacted, will see the MPs paid at 31 per cent of their Sh200,000 basic pay for every year in service until August 26, 2010 when the Constitution was promulgated. From then until the end of their term on January 15, 2013, the calculation will be based on a gross pay of Sh851,000.

Not surprisingly, the lawmakers are unbowed by the legal requirement to have the pay issue handled by the Salaries and Remuneration Commission.

They also approved changes to have all regulations by the Commission on Revenue Allocation and the SRC subjected to parliamentary approval, meaning they hold the trump card should the two regulators step in.

Mr Githae and the Finance Committee chairman, Mr Chris Okemo (Nambale), meanwhile agreed to shelve the plan to backdate the payment of taxes on MPs’ perks to June 15 this year, when the budget was read.

The minister had hoped to repeal the law that MPs have consistently relied on to shield their allowances from the taxman but they struck a deal on the floor of the House with the committee to have the law apply after the next General Election.

Kenya’s Constitution makes it irregular for a state officer to be exempted from paying tax, regardless of the office they hold.

The term of the current MPs expires on January 15, 2013. After negotiating with the Treasury, the PSC had already earmarked Sh500 million to cover the taxation of the MPs’ perks until the expiry of their term.

***  additional material below (hansard report) added by Blog-Admin ***

By einstein Posted in kenya

30 comments on “MPs award themselves Sh2bn bonus in secret deal

    • hehehe einstein

      that is not selfish

      that is true kibakish / kibakism

      its all about kibaki

      i dont know what those MPs were thinking, they thought they’d rub his back, and he’d rub theirs back ….. hehehe …. plain dumb …. kibaki cares about nothing but his old self.


      • Yes indeed that is your Thief in Chief. Hehrejects the allocation of perks to M.Ps and kina PM and VP as unconstitutional. which is true and somehow withjout a trace of shame awards himself the same illegal retirement package and signs it himself. This is headed to court straight and Kibaki’s argument is going to be that he is retiring and therefore is no longer state officer awarding himself benefits. I bet you that is what the dark forces worked out with their AG, Githu Muigai. Well gues what Kibaki has signed that bill into law in his capacity as the sitting president of Kenya. He is going to lose that battle in court. I mean how much money does Kibaki need to bring all these headaches to him in retirement?

        I have always said that there is a special place in hell for the likes of Kibaki. He is heading there without a doubt. That is really where he belongs after what he has done to Kenyans in the last ten years.


      • tnk, Adongo and all,
        Kibaki is so shameless.
        What logic did he use to deny others the pension while he signs his own?

        Even if one is greedy and worships money, this is just too much.

        In my opinion, Kibaki should have rejected even his own “reward” to show that he loved the country. I think that the old man is rich enough not to want to pocket more millions of our taxes. But here we are, we have a man used to conning his way in and out of everything.


  1. Guys,

    The truth of the matter is that Kibaki was compelled to decline assenting to this because of the Petition 175 of 2012 by Mars Group. There is no chance Mps were going to win this. Kibaki had to think quick and save himself as he has done many times before. But looking at the individuals who supported this bill, it is dominated by TNA/UDF/URP aligned MPs, with a few from ODM. I will highlight a few.

    Bonny Khalwale, the self styled MP masquerading as the people’s watchman appears on the list of MPs who voted to illegal rip-off Kenyans. It’s difficult to imagine that Hon. Dr. Bonny Khalwale is also serving as Chairman of the all-powerful Public Accounts Committee that is charged with “examining reports by the Controller and Auditor-General on Central Government expenditure and fund accounts”. Martin Shikuku and JM Kariuki must be turning in their graves!!

    Mutava Musyimi, a presidential candidate and one who purports that he will challenge Uhuru Kenyatta for TNA ticket is also on that list. Never mind that this man was once supposedly a man of god, an ordained priest! Sheeesh, that almost made me throw up!

    The Finance Minister, njeru Githae, one who is the appointed custodian of the public coffers conspired with MPs and helped them with his vote to pass this thievery. He did not want to pay teachers or doctors who serve the common man. He does not hesistate to pay himself and others gratuity for making a total mess of legislation in the last four years.

    The new MP for Kajiado North, Moses Ole Sakuda, another ordained priest, is also among those who are demanding public pay them gratuities while he himself will only be in parliament for about three months before the house is formally dissolved. @Einstein, now I agree with you on your thread about why Kenyans prefer to pray at home rather than go to church.

    This incident offers Kenyan voters a chance to assess and interogate the loyalty of current MPs who have plans to run in 2013. If these 84 can do this in broad daylight, what do they do behind closed doors when they take sole charge of multi-million shilling CDF accounts or are meeting as a committee to discuss a bill to limit bank interest rates, or when they are bribed to pass censor motions? It’s a nightmare just to imagine.

    Adan Keynan, another Chair of a key committee in the house, the Defence and Foreign Relations Committee, also has his dirty fingerprints on this aborted gratuity scam. He hounded Wentangula out of office due to the Japan Embassy scam but this was because the scammers thought his demands to influence committee report was unjustifiably high.

    Here’s the full list of greedy disgraced MPs of the 10th parliament:

    1 Abdalla Amina Ali.
    2 Abdi Nasir.
    3 Abdul Bahari.
    4 Abu Mohamed Chiaba.
    5 Adan Keynan Wehliye.
    6 Alex Muthengi Mburi Mwiru.
    7 Andrew Calist Mwatela.
    8 Asman Abongotum Kamama.
    9 Atanas Manyala Keya.
    10 Bare Aden Duale.
    11 Barnabas Muturi C. Mwangi
    12 Beth Wambui Mugo.
    13 Bifwoli, Wakoli Sylvester.
    14 Boni Khalwale (Dr.)
    15 Cecily Mutitu Mbarire.
    16 Charles Cheruiyot Keter.
    17 Clement Muchiri.
    18 Daniel Mutua Muoki.
    19 David Njuguna Kiburi.
    20 Elijah Kiptarbei Lagat.
    21 Emilio Mureithi Kathuri.
    22 Empraim Mwangi Maina.
    23 Erastus Kihara Mureithi.
    24 Esther Murugi Mathenge.
    25 Ethuro, David Ethuro.
    26 Eugene Ludovic Wamalwa.
    27 Francis Chachu.
    28 Francis S. K. Baya
    29 Frankilin Mithika Linturi.
    30 Githae Robinson Njeru.
    31 Githu Muigai (Prof.)
    Attorney General Ex-Officio.
    32 Hellen Jepkemoi Sambili.
    33 Hussein Mohamed Abdikadir.
    34 Hussein Tarry Sasura.
    35 Ibrabim Elmi Mohamed.
    36 Isaac Kiprono Rutto.
    37 Isaac Mulatya Muoki.
    38 Jackson Kiplagat Kiptanui.
    39 James G. Kwanya
    40 Jamleck Irungu Kamau.
    41 Japhet M. Kareke Mbiuki
    42 Jeremiah Ngayu Kioni.
    43 John Michael Njenga Mututho.
    44 Johnson Nduya Muthama.
    45 Joseph Nganga Kiuna.
    46 Josephat Nanok Koli.
    47 Joshua Serem Kutuny.
    48 Kilimo, Linah Jebi.
    49 Kilonzo Charles Mutavi.
    50 Kiunjuri, Festus Mwangi.
    51 Kuti, Mohammed. Abdi
    52 Lee Maiyani Kinyanjui.
    53 Lenny Maxwell Kivuti.
    54 Lewis Nguyai.
    55 Mahamud Muhumed Sirat.
    56 Maitha Gideon Mungáro.
    57 Manson Nyamweya.
    58 Mbau, Elias Peter.
    59 Mohamed Hussein Ali.
    60 Mohamed, Muhamud.
    61 Moses K. Lessone
    62 Moses Somoine ole Sakuda.
    63 Mungatana Danson.
    64 Munya Peter Gatirau.
    65 Musila, David.
    66 Mutava Musyimi.
    67 Mwalimu Masudi Mwahima.
    68 Mwiria Valerian Kilemi.
    69 Ndambuki, Gideon Musyoka.
    70 Ndiritu Muriithi.
    71 Nemesyus Warugongo.
    72 Ntoitha M”Mithiaru.
    73 Peter L.N. Kiilu
    74 Peter Mungai Mwathi.
    75 Peter Njoroge Baiya.
    76 Peter Njuguna Gitau.
    77 Richard Momoima Onyonka.
    78 Robert Onsare Monda.
    79 Samuel Kazungu Kambi.
    80 Shaban, Naomi Namsi.
    81 Silas Muriuki Ruteere.
    82 Tirus Nyinge Ngahu.
    83 Wavinya Ndeti.
    84 William C. Kipkiror
    85 Yakub Mohammad.
    86 Yusuf Hassan Abdi


  2. I was listening to Jambo Kenya, a breakfast show on Radio Citizen, broadcast in Swahili, arguably with the widest reach in Kenya and the region, and 100% of the call-in listeners condemned the greed by the MPs. Am sure you guys in the diaspora can listen in on live stream found on the Royal Media website.

    One good thing is though about today’s show is they kept on repeating a clip in which the Prime Minister is quoted as condemning the award and expressing in no uncertain terms his opposition to this illegal award. Apart from Martha Karua and Peter Kenneth, I am yet to come see akina Uhuru, Kalonzo and Ruto issuing statements to condemn the MPs on this. Mudavadi did issue a statement but his was 50/50, not condemning the MPs and not agreeing with the bonus award. Mudavadi even criticized the salaries commission for not being proactive. This clip was not played on Jambo Kenya though.

    Here is another sober statement from our friends in the civil society:

    I personally plan to join in one of the two demonstations planned tomorrow to protest this self-award by the MPs. Bunge La Wananchi will be in town as will a group of bloggers and social media commentators who have also obtained police notification of the peaceful demonstration. If we can get middle class Kenyans on to the streets, then this is not a good time to be an MP or a water melon.

    Demonstration Invite

    In the meantime, we are awaiting Kibaki’s approval of this illegality and greed. it will only go to confirm that the loyalty of the MPs is being bought in preparation for further reversals of the constitutional reform process.

    It stinks!


    • phil
      anxiously waiting for feedback from this. i think the MPs once again underestimated public resentment and sooner or later these guys will have to go home empty handed as they came


  3. MPs’ Sh2bn exit package illegal, Salaries and Remuneration Commission declares

    The Salaries and Remuneration Commission has declared the hefty exit package that MPs have awarded themselves illegal and promised to consider moving to court to block it.

    Commission chairperson Sarah Serem condemned the move saying it is unconstitutional.

    She said such payments can only be effected by the Commission. “The decision by Parliament was therefore null and void and will be fought in the courts if necessary,” she said. (READ: MPs award themselves Sh2bn bonus in secret deal)

    The Salaries and Remuneration Commission was established by the Constitution of Kenya, 2010 with the mandate to set and regularly review the remuneration and benefits of all State Officers and to advise the national and county governments on the remuneration and benefits of all other public officers.

    The secret move has provoked outrage from Kenyans who have reacted angrily terming it selfish.

    The Commission for the Implementation of the Constitution has also declared the package unlawful. The commission said changes made by MPs to the Finance Act sneaking in the hefty package was unconstitutional.

    Its chairman Mr Charles Nyachae said the commission is ready to challenge the package if President Mwai Kibaki goes ahead to assent the Finance Bill into law to allow for implementation of the controversial package.

    Each of the 222 MPs is set to receive a Sh9.3 million sendoff package as a result of the hush-hush manoeuvre by the MPs as the clock ticks to the next general election.

    MPs on Thursday night sneaked amendments to the Finance Bill and overwhelmingly voted to award themselves the Sh2 billion gratuities at the end of their term.

    National Assembly Speaker Kenneth Marende and Attorney-General Githu Muigai who are ex-officio members of Parliament—will take home Sh9.3 million at the end of their term that ends on January 15, 2013, if President Kibaki clears the package with a signature.

    Parliamentary Service Commission (PSC) Vice Chairman Adan Keynan introduced amendments to the National Assembly Remuneration Act pegging MPs severance allowance at the rate of 31 per cent of the gross remuneration payable to the legislators each month.

    The severance pay includes the salary, constituency allowance, nominated members allowance, ex-officio members allowance, House allowance, extraneous allowance, transport allowance, entertainment allowance and vehicle fixed cost allowance.

    The gross pay each member takes home every month is Sh851,000. MPs approved the amendment that was not listed in the Order Paper without any debate at about 8.40pm on Thursday night.

    As a result, they will earn gratuity at 31 per cent of the salary for every year in service, in respect of the period up to August 26, 2010 and at the same rate after the promulgation of the new Constitution on August 27, 2010. Last year, the legislators amended the Finance Bill 2011 to increase their severance perks to Sh3.3 million each (Sh300,000 per month).

    Civil society groups went to court to challenge the matter and a ruling is yet to be made.


  4. Anger Over Kenyan MPs’ Sh2.2 Billion Bonus

    By Digital Reporter

    More Kenyans and Civil Society groups voiced their concerns over parliament’s move to pay themselves hefty send off package at the end of the House’s term.

    The MPs added a Sh2.1 billion severance pay to their already fat perks in changes introduced in the Finance Act on Thursday night as part of their winding up gratuity.

    Anti-graft organisation Mars Group Kenya condemned the greed with which MPs selfishly awarded themselves the money in a secretive manner and said the act was in contempt of court as there was a petition opposing arbitrary increase of salaries and allowances.

    “We have noted the brazen action of the Kenya National Assembly to yet again award its members substantial personal remeuneration, without regard or approval of the Salaries & Remuneration Commission established under Article 230 of the Constitution of Kenya,” said Mwalimu Mati, the Mars Group Chief Executive.

    Mati accused the MPs and the Parliamentary Service Commission of having abused their privileges and disregarded all rules of decency and conflict of interest to purport to yet again enact increases to their personal remuneration and allowances.

    “This is contemptuous to proceedings before the High Court of Kenya in Petition 175 of 2012 of which the Parliamentary Service Commission is very aware (having applied to be enjoined in the same proceedings as a party).

    In Petition 175 of 2012 Jayne Mati has urged the High Court to find that antecedent behaviour to amend the Finance Bill of 2012 was unconstitutional specifically the court was urged to decide that:

    (1) The Court be pleased to issue a declaration to issue that sections 44 and 44A of the Finance Act, 2011 is ultra vires Article 230 of the Constitution of the Republic of Kenya and are therefore null and void.

    (2) The court be pleased to issue a declaration that it is

    unconstitutional for the National Assembly and/or any person, state organ and/or any state authority to review, increase or in any way deal with the salary and/or remuneration of any public officer without the recommendation and/or authority of the Salary and Remuneration Commission.

    Mars Group said it will crusade against the hefty allowance increase. “Public Service Commission, the Salaries and Remuneration Commission and the general public are hereby notified that petition 175 of 2012 will never be abandoned by the Petitioners.

    The petitioner resolved to oppose the contemptuous, outrageous, and provocative acts by MPs, in the High Court and if need be pursue and apply for corrective action against the Parliamentary Service Commissioners for their contempt of these proceedings, at the next hearing on Monday before Justice David Majanja.


    • 230. (4) The powers and functions of the Salaries and Remuneration
      Commission shall be to —
      (a) set and regularly review the remuneration and benefits of all State

      How again does this happen at this critical time with everything else that is going on and why are the courts dragging their feet with the petition that is already pending? I am glad the civil society groups have come out strong against this move by our MP’s, however, I am not sure this will achieve much at the moment. Whatever happened to the salaries commission that was regulating what state officer’s earnings? I also hope that the MP’s are aware that once they are voted off in the next parliament, we can still go after them individually to collect the loot and there will be no parliament to hide behind.


  5. Most of the M.Ps (approximately 80%) will be thrown out by the voters. In 2007 about 70% were thrown out. That is why I do not understand the obsession of trying to harvest M.Ps as some sign of political potency among the parties that is getting so many people excited. When you go to harvest crops of which 80% is pure garbage, it doesn’t strike me as a very useful activity in any human endevour.

    Anyhow I have submitted my request to post staff on the blog. I love the underground world I live in now but may be occassionally I will post stuff. But I will tell you, it is nice when people have no clue what you are doing. You can accomplish a whole lot more. I intend to keep that aspect for some time but I will make noise as I always do.



    • Adongo,

      On behalf of DeepCogitation, its a pleasure, honor and priviledge to have you back in discussion forums. Your valued insight has been sorely missed.
      We are indeed fortunate to have you join this forum and can assure you that your experience here will be well worth it.
      Welcome aboard and look forward to your contributions whenever you have time. Am sure you are engaged in efforts that help improve our society and wish you all the best.


      • Thanks my friend.

        I have a few things coming up soon.

        1. My trip to the country and what I learned or may be failed to learn. That is coming.

        2.The US presidential election. I am watching it with a hawk eye. The president was doing very well then be bombed out in the debate on Wednesday. He is back now with the economic horizon looking better but people are still shaking their heads as to why the president didn’t blow Romney out of the race.

        But this election has so many lessons for the Kenyan election next year one of which is the fact that it doesn’t matter so much what you are against in elections, at some point voters need to know what you have in store for them. That is what has been killing Romney. It is a big problem in the Kenyan election too.

        3. Then we have the elephant in the tent with the anouncement by the IEBC that the run-off elections will be held on April 11, 2013.

        For the record on that date one of the key contenders for the presidency Mr. Uhuru Kenyatta will either be at the dock at The Hague fighting for dear life or he will be an international fugitive on the loose.

        Already herlings of Uhuru have gone to court asking for an amendment of the constitution to allow an incoming president to be sworn in somewhere else other that the Kenyan capital city as stipulated in the current constitution. I don’t know how these individuals expect the court to amend the constitution.

        But here is the bottomline. On April 11, 2013 when Kenyans go to the polls to pick their president in the very likely event that this thinsg go to a run-off we may very well have a situation where some Kenyans may be voting for someone they may never see again in the country. How does that work?

        And where does that leave the endless and hopeless “unity” talks which as of right now means the jokers have to coronate Uhuru? He is doing well in the “polls” why should he hand over his crown? Can one be a president of the republic of Kenya while they are tied up defending themselves against mass muder and rape of Kenyans at The Hague? Go figure?

        Those are just a few things I would like to look at, time allowing.


What Say You Now?

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s