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Council of Governors and the County Assemblies Forum’s (CAF) has opposed forceful  attempt by the national government to take over Laptrust and County Pension Fund (CPF) by the national government.

The schemes comprise Sh60 billion pension fund for county employees. They are  now being wrestled by the National Treasury after being listed as State Corporations.

National Treasury has been on an overdrive gear to raid coffers of State entities to fund its programmes.

In a press statement yesterday, CoG and CAF termed the listing of Laptrust and County Pension Fund as State Corporations unconstitutional, illegal and ultra vires.

“Laptrust and CPF are neither State corporations nor agencies of the National government to warrant the pervasive control and direction embodied in the impugned directives,” a joint statement by CoG’s Finance Committee Chairman Governor Wycliffe Wangamati and CAF’s chairman Ndegwa Wahome.

They went on: “Laptrust and CPF are pension schemes for employees of counties as opposed to the National government.”

“Laptrust and CPF do not receive, spend or manage any funds from or on behalf of the National Government to warrant the pervasive control and direction embodied in the impugned Directives,” they added.

CoG and CAF held  that the County Pension Fund is one of the best run pension schemes managed by Trustees drawn from the Ministry of Devolution, county employees, water service providers, pensioners, an accountant and the Law Society of Kenya.

The two entities further opined that the schemes are pension fund for county workers that can only be revoked as prescribed in law and not in any other way.

Public entities

“There exist many occupational pension schemes for public entities in the country. They are managed by Trustees without ANY interference from the National government because they are not deemed to be State corporations within the meaning of the State Corporations Act,” the statement noted.

They added: “It is our considered view that implementation of the circulars will pose conflicts between the trustees’ fiduciary duties to the members and sponsors of Laptrust and CPF.”

The duo explained that the trustees do not have a fiduciary duty to obey directives issued by the Cabinet Secretaries, the State Corporations Advisory Committee or any other agencies of the National government named in the directives in question.

COG and CAF were reacting to a circular dated August 22 issued by the Head of Public Service Joseph Kinyua titled ‘outcomes of the consultative meeting on the Local Authorities Pension Trust’.