Retired public servants demand urgent action over withheld Sacco savings

Retired public servants across Kenya are demanding urgent intervention from the Ministry of Cooperatives and other regulatory bodies, citing prolonged financial hardship and neglect stemming from Sacco societies' failure to release their retirement savings, some of which have been pending since the early 1990s.

In a letter dated July 9, 2025, addressed to Cooperatives and MSMEs Cabinet Secretary Wycliffe Oparanya, the Retirees Benefits and Claims Welfare Association of Kenya (REBECLWAK) accused the government of turning a blind eye to the plight of thousands of retirees whose Sacco share deposits remain unpaid long after their exit from public service.

“It disturbs us as an Association that issues affecting retirees are relegated to the periphery when all they are asking for are their hard-earned savings,” said Benson Ambuni, the Association’s National Chairman and CEO.

Ambuni expressed frustration that despite writing several letters, physically visiting government offices, and making numerous follow-up calls, the Ministry has either failed to act or completely ignored their correspondence. In the letter, the Association questioned whether the Ministry had been adequately briefed on the matter or was simply too preoccupied to address retirees’ concerns.

REBECLWAK, which is registered under the Societies Act to represent public sector retirees, also highlighted that no progress has been made since a meeting held with the Cabinet Secretary in August 2024.

In a follow-up letter dated August 27, the Association had raised concerns about what it described as “immense mental torture” inflicted on retirees by Sacco societies that continue to withhold their funds without explanation or action.

The Association identified various reasons for the delayed payments, including unfulfilled promises by Sacco societies, the fragmentation of some into smaller entities, mismanagement of member investments, lack of a proper framework for government-Sacco-retiree engagement, and overall weak regulatory oversight.

They also cited delayed government intervention, the absence of bailout mechanisms for affected members, unchecked registration of new Sacco societies without sufficient scrutiny, and a broader lack of prioritisation for retirees’ refunds.

In response to these challenges, REBECLWAK urged CS Oparanya to convene a multi-stakeholder meeting involving the Association, officials from the Sacco Societies Regulatory Authority (SASRA), and the Ministry to develop a structured engagement framework to resolve the ongoing crisis. The group further called on the CS to seek a government bailout for 1,034 retirees whose savings—amounting to approximately KSh158 million—are currently held by Transcom Sacco Society Ltd.

The letter also requested that the Ministry directly engage with specific Sacco societies, including Lamu Teachers Sacco, Ukulima Sacco (Lamu branch), Tana Tea Sacco (Tana River), and Ulinzi Sacco Society (Nairobi), to demand updates on pending refunds and issue strict timelines for disbursement.

Additionally, the Association called for critical amendments to the ongoing Sacco Societies Bill. These include introducing mandatory timeframes for processing share deposit refunds upon retirement, imposing penalties of at least 10 percent for delayed payments, and classifying Sacco deposits by retirees as part of retirement benefits under the Retirement Benefits Authority (RBA) Act.

They also proposed that retirees and relevant stakeholders be involved in Sacco policy development to better monitor the financial health of these institutions and safeguard member interests.

In a separate letter dated April 16, 2025, addressed to the Director General of the Competition Authority of Kenya (CAK), REBECLWAK expressed concern that some pension schemes and operating Sacco societies continue to deny or delay payment of dues, including for retirees who are seriously ill.

The Association described heartbreaking encounters with retirees who have been denied access to their savings, which could have provided them with a peaceful and dignified retirement. Many, the letter noted, had retired years ago and continue to wait for money they had planned to use for critical needs, including healthcare and debt settlement.

The letter lamented that while Sacco societies often promise flexibility at the time of recruitment, they make it nearly impossible for retirees to access their funds upon exit. This concern was echoed again in a communication to Afya Sacco Society Ltd dated March 25, 2025. In that letter, REBECLWAK accused Afya Sacco of ignoring multiple correspondences and failing to refund deposits to retirees. It detailed incidents where withdrawal forms were lost or ignored and where Sacco officers assigned to follow up on the cases remained unresponsive.

The Association also criticized the continued deduction of share contributions from retired members who had clearly expressed their intention to exit the Sacco. Some members, they reported, were turned away from FOSA branches despite having unutilized savings. They urged Afya Sacco’s leadership to personally review the enclosed cases, hold a meeting with REBECLWAK officials, and establish a consistent feedback mechanism to address grievances.

By March 2025, the Association had compiled a comprehensive dossier of unresolved cases involving Sacco societies accused of withholding retirees’ funds. Transcom Sacco Society Ltd in Nairobi alone reportedly owes KSh158 million to 1,034 retirees.

At least 18 additional retirees are still awaiting their refunds from Ulinzi Sacco, while other complaints have been lodged against several other Saccos across the country, including Lamu Teachers Sacco, South Nyanza Sugar Company Sacco (Sonyaco), Migori Teachers Sacco, Metropolitan Sacco, Tana Teachers Sacco, Afya Sacco, and Ufundi Sacco.

The list of affected individuals includes Mary Atieno Ndalo from Mombasa, who never received her withdrawal form; Susan Muthoni Maina from Nairobi, who is on the verge of losing her property; and Franciscah Bahati from Mombasa, who was forced to postpone overseas medical treatment.

Others, such as Tumaini Charo in Tana River and Leonard Denje in Kilifi, have been waiting for their refunds since 2024. John Mukoma from Busia is currently facing a demanding court case without access to his funds, while Jones Makori from Mombasa, who formally resigned in June, has yet to receive his payout.

REBECLWAK has since forwarded these cases to the Ministry of Cooperatives, SASRA, and other oversight agencies, calling for immediate action to release the trapped funds and prevent further suffering among affected retirees.

Despite growing frustration, the Association reiterated its commitment to maintaining a cordial working relationship with authorities, even as pressure mounts on government institutions and Sacco societies to act swiftly and restore confidence among retired members of the public service.