Home Business Laptrust, Lapfund to hold talks to end merger standoff

Laptrust, Lapfund to hold talks to end merger standoff


Laptrust, Lapfund to hold talks to end merger standoff


Nairobi Senator Johnson Sakaja addressing the press outside Parliament buildings on April 8, 2020. PHOTO | SILA KIPLAGAT | NMG

The Local Authority Pension Trust (Laptrust) and the Local Authority Pension Fund (Lapfund) are in talks over their disputed merger in order to pave the way for the implementation of the County Governments Retirement Scheme Act, 2019.

The law merges all pension schemes covering county government workers including the County Pension Fund (CPF).

But court battles have hindered the consolidation of the pension schemes, leaving them running independently.

On Wednesday, the two schemes, the Retirement Benefits Authority (RBA) and the Kenya County Government Workers Union (KCGWU) appeared before Senate’s Labour Committee where they expressed willingness to engage in discussions to end the standoff.

However, the stakeholders said they would only participate in talks led by a third party and on neutral grounds.

RBA and KCGWU are not opposed to the merger.

But the county staff lobby moved to court after the law was enacted arguing that workers’ input and concerns had been ignored. The union also argued that parallel operations by the two schemes were a waste of the workers’ money.

“The two schemes are simply duplicating functions and engaging in unhealthy competition. We agree to dialogue that is held on neutral ground and handled by neutral parties,” said Matilda Kimetto representing KCGWU.

The schemes have differed on various issues key among them the process that would be used to select a board of trustees.

Both the National Treasury and the Senate committee have pledged to engage the parties separately and jointly even as plans to hold the talks are set.

“We will have to frame a formula that will work towards the solution of the standoff,” said the Labour Committee chairman, Nairobi Senator Johnson Sakaja.

Senate directed the parties to report back in two weeks on the progress of setting up a forum for dialogue.

Laptrust was originally set up to cater to the senior cadre of local authorities’ staff while Lapfund was to accommodate the rest of the staff. But with the liberalisation of the market in 2006, members were free to join their preferred scheme.

Lapfund was created by an Act of Parliament and Laptrust was set up by a legal notice.

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