Kenya Railways has announced plans to sell urban properties valued at approximately US$123 million to address long-standing pension arrears under its Staff Retirement Benefits Scheme. The move comes amid mounting pressure from retirees and lawmakers over delayed payments, as the scheme continues to struggle with chronic funding shortfalls.
Philip Mainga, Managing Director of Kenya Railways, told the Senate Committee on Labour and Social Welfare that a detailed repayment plan has been mapped out to January 2026. The corporation is also awaiting a KSh2 billion (US$15.5 million) payment from the Kenya National Highways Authority (KENHA) for a parcel of land previously sold, which will contribute to settling the KSh2.26 billion (US$17.5 million) owed in arrears.
As part of the strategy, Kenya Railways plans to market two of its most valuable city estates, Makongeni and Ngara. Makongeni Estate has been valued at around KSh8 billion (US$61.9 million), while Ngara Estate is expected to fetch between KSh8 billion and KSh10 billion (US$62–77 million). Mainga emphasised that the proceeds would provide a sustainable financial base for the retirement scheme, ensuring future pension payments are stable and reliable.
Legal constraints prevent the corporation from pursuing litigation or auctioning properties to recover debts from other government agencies, leaving voluntary asset sales as the primary option to bridge the funding gap.
Senators urged Kenya Railways to accelerate the disposal process and implement interim relief measures for pensioners waiting for payments. Kajiado Senator Samuel Kanar Seki called for the use of debt-recovery agencies to enforce outstanding remittances, stating, “It is unfair that pensioners who served this country diligently have to wait decades for their rightful dues.”
The Kenya Railways Staff Retirement Benefits Scheme, launched in 2006, inherited liabilities exceeding KSh16 billion (US$123 million), including unpaid contributions and arrears. Despite previous asset liquidation attempts, bureaucratic delays and slow sales have prevented a full resolution.
Residents of Makongeni Estate have protested the proposed sale, raising social and political tensions. If executed as planned, this would become one of Kenya’s largest state-led property liquidations aimed at fulfilling pension obligations, potentially relieving thousands of retirees who have endured years of delayed payments.
Mainga reassured lawmakers, “We have a clear plan … Our goal is to clear all outstanding balances by early next year and secure a sustainable payment structure going forward.”
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