The NSSF is likely to give workers who are forced to surrender their retirement savings to the fund a raw deal judging from their past performance, Jubilee Insurance pension managers have said. The fund is riddled with mismanagement and corruption, which have seen workers earn about five per cent on their savings historically, compared to double-digit earnings paid out by private pension managers. Jubilee, for example, has averaged 10.5 per cent in the past 13 years. "Members benefits will be affected by low returns that the NSSF has been giving. Again the members have no control on the fund but contracting out may give members more control," said Jubilee Insurance head of pensions business David Ogega on Friday. Mr Ogega said privately managed pension schemes were likely to be more lucrative for retirees. Jubilee Insurance retirement assets rank among medium-sized pension managers with Sh14.3 billion as at the end of 2012. Mr Ogega said the projected benefits at the NSSF may not be realised, yet returns were key when considering what type of a retirement scheme to join. He noted that employers are likely to review the costs associated with the new contribution rates and compliance requirements. "Employers will also have to review employment contracts and any gratuity arrangements, payroll systems and train trustees and educate employees," noted Mr Ogega . READ: Passage of NSSF Bill sets stage for pension scheme For employers with in-house schemes, they would have to amend trust deeds and rules as they arrange to contract out, he said. Employers who do not have schemes will have to consider establishing a scheme and contracting it out, as well as review employee contracts since it is now mandatory for every employee to be in a scheme. The other option is to put all the pension assets of employees under NSSF.
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