Long-serving chief executive of the Retirement Benefits Authority (RBA) Edward Odundo is set to end his term at the State agency, bringing to an end a 16-year tenure in the critical pensions industry.
The agency’s board said Thursday Dr Odundo’s contract had come to an end and that he had been replaced in an acting capacity by Nzomo Mutuku.Dr Odundo took the RBA job in January 2001.“On behalf of the board, I would like to thank Dr Odundo for his invaluable leadership and commitment to RBA,” RBA board chairman Victor Pratt said in a statement.“We have witnessed tremendous growth in the industry during his tenure and he leaves a strong foundation that will spur this country’s economic development. We wish him well as he moves on to pursue other interests.”Dr Odundo is credited for growing the pension industry from Sh50 billion to Sh1 trillion and giving Kenya a global presence when he was appointed the President of the International Organisation of Pension Supervisors, a role he holds to date.The former RBA chief says he is proud of bringing reforms anchored in law and which have provided a strong foundation for the pensions industry to grow.“When I started, there was no legal framework for pensions,” Dr Odundo told the Business Daily, adding that pensions fell under the income tax laws at the time.This meant that investment in pension money and access to the same was up in the air, creating an environment where pensioners could lose their cash to fraudulent employers. An employer, for instance, could dip into a worker’s pension pot to settle liabilities.“Pension benefits are now well protected and cannot be used by an employer,” Dr Odundo said. He said there were no prescribed rules on how the retirement cash could be invested, a situation that saw some companies use the money in their own operations or simply hold them in bank accounts.The RBA developed elaborate investment rules for pension funds, specifying what percentage of the portfolio should be allocated in which asset classes.Pension funds can now invest in government bonds and T-bills, listed equities, private equity and infrastructure projects such as energy among other investment categories.“I believe assets in the pension industry can triple to Sh3 trillion. The sector has grown because of the confidence brought by the reforms. More countries are emulating the Kenyan pension system,” Dr Odundo said.
Dr Edward Odundo became RBA head in January 2001. Photo Courtesy