A Senate Committee has put the Technical University of Kenya (TUK) on the spot for blatant disregard of the law and failure to remit more than Sh800million in contribution from the Technical University Staff Retirement Benefits Scheme.

The Senate Labour and Social Welfare Committee, chaired by West Pokot lawmaker Julius Murgor, heard that the institution has not been remitting statutory deductions and other third-party deductions since 2013, running into hundreds of millions of shillings.

Yesterday Retirements Benefits Authority (RBA) Chief Executive Officer Charles Machira told the committee that given the low funding level of the scheme, the persistent breaches by the scheme and the absence of any concrete remedial action by the university it was constrained to petition the High Court for winding up of the scheme.

“The liquidator now has a legal duty to collect the contribution arrears from the scheme’s sponsor (TUK) and pay the outstanding benefits to the scheme’s members,” said Machira.

According to the scheme’s Trust Deed and Rules (TDR), contribution to the scheme were initially set at 7.5 per cent for the employee and 15 per cent for the employer between July 1, 2009 and June 30, 2013.

Machira told the committee that from July 1, 2013 onwards, the rates were to increase to 10 per cent for employees and 20 per cent for the employer. However, the employer continued to remit contributions at the rate of 7.5 per cent.

However, the University’s Vice Chancellor Prof Mutua (inset), in his response, painted a grim picture of how it is operating on a negative capital to not only run its operations but also pay its staff their salaries and other statutory deductions.

According to Prof Mutua, the university is only receiving Sh63million as capitation from the National Treasury against a budget of Sh272million.

“We are not able to remit statutory deductions. We are only paying net salaries to our staff. This is because we require Sh272million. We are now spending Sh156million yet the National Treasury only gives us Sh63million as capitation. We cannot because we have adequate funds,” said Prof Mutua.