Kenya will need to significantly increase investments in social safety net programmes to at least Sh1.6 trillion (10 per cent of GDP) to keep up with the rising demand from its ageing population, industry players say.
County Pension Fund and International Labour Organisation said that the country is currently grappling with low allocation towards safety net programmes denying the elderly decent retirement.
Speaking at the launch of the CPF Foundation, International Labour Organization coordinator for Kenya Wycliffe Opara said that there is an urgent need for the government to scale up funding and policy frameworks aimed at protecting older citizens as the country’s demographics shift.
Currently, an estimated 2.7 million Kenyans are over the age of 60, according to the 2019 national census.
That number is projected to grow rapidly, with the UN forecasting that 10.5 per cent of the population will fall into this age group by 2050 — representing around 6 million people.
“The current social protection budget stands at approximately 3.5 per cent of GDP, that is significantly below the international average. We should be aiming for at least 10 per cent of GDP to meaningfully support the growing number of elderly Kenyans,” said Opara.
In an effort to ease the pain for retirees the pension fund has unveiled a foundation which aims to advocate for the rights and welfare of senior citizens, including through housing, pensions, and policy lobbying.
The Foundation plans to promote the development of “golden villages” — dignified, community-based housing for elderly citizens.
CPF Group CEO Hosea Kili said that Kenya's growing elderly population is placing new demands on the country’s social support systems, prompting calls for increased investment and collaborative action.
“What we are advocating for is that as the government, you should be able to look at social protection safety nets that can be able to guide, to help when people get out of productive years, 60 and above when you retire, you can have a dignified life in terms of how you can be able to live,” said Kili.
“So you can see that we're also going to have a lot of people get into that bracket. One of the things that we have noted is that people retire young, 60s now, very young, they still have energies, understanding, their sight is still very good, their hearing is okay, they can still be able to work.
Opara pointed out the need to boost universal health coverage (UHC) and expand pension schemes to ensure that people can maintain a decent quality of life post-retirement, regardless of family support.
“There must be a shift in mindset. Retirement no longer means helplessness. Many retirees are still productive and active, and our systems should reflect that,” he added.
While recent proposals in the 2025 Finance Bill — such as tax exemptions for pensions and gratuities — have been welcomed by industry leaders, both the ILO and CPF stress that policy reforms must be matched by financial commitments.
“Planning must start now. If we delay, we will not have the fiscal space to care for our ageing population in a humane and sustainable way,” said Opara.
As part of its collaborative approach, the CPF Foundation has partnered with organisations like HelpAge International and Suqoon Kenya among others to implement high-impact programs.
