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In a significant development, the Kenyan Ministry of Labour has unveiled a proposal to introduce a mandatory welfare fund for Kenyan citizens employed abroad. Known as the Kenya Migrant Workers Welfare Fund, this initiative is designed to offer essential support to Kenyan migrant workers, including medical assistance, relief support, and survivor benefits for the families of those who may tragically pass away while working overseas.

Under the proposed legislation, all Kenyan citizens planning to work abroad will be required to register as members of the Kenya Migrant Workers Welfare Fund. Additionally, fees paid by private employment agencies on behalf of these workers will be directed towards bolstering the fund’s resources.

Labour Principal Secretary Geoffrey Kaituko expressed optimism about the plan, explaining, “This is a contributory fund, with the government also contributing funds. It’s an innovative solution to address the challenges faced by our migrant workers, providing them with vital support when they need it the most.”

The specific contribution rates for individual migrant workers will be determined and published in forthcoming regulations.

Should this legislation be approved, Kenya will join the ranks of countries with significant diaspora populations, such as the Philippines, Sri Lanka, and Pakistan, all of which have established similar funds. For instance, Sri Lanka boasts the Overseas Workers Welfare Fund, which covers various expenses for the country’s migrant workers and their families, including a compulsory insurance scheme, repatriation costs, scholarships for children, and loan programs to support self-employment endeavors.

The proposed Kenya Migrant Workers Welfare Fund will be overseen by a board, with the chairman appointed by the President.

Shem Ochuodho, the global chairman of the Kenya Diaspora Alliance, voiced support for the initiative, stating, “Any effort to improve the welfare of the diaspora is welcomed, as long as diaspora members are involved. While the specific deductions are yet to be determined, their use will be justified through proper management.”

According to the Ministry of Labour, Kenya is home to nearly four million migrant workers, primarily located in North America, Europe, the Middle East, the Gulf region, and Australia. A Central Bank of Kenya survey on diaspora remittances indicates that job opportunities and higher education are the primary motivations for Kenyans choosing to live abroad. The majority of Kenyans in the diaspora are found in the United States, the United Kingdom, the United Arab Emirates, Canada, Australia, and South Africa.

This move to establish the Kenya Migrant Workers Welfare Fund aligns with the country’s increasing diaspora remittances, providing essential support to Kenyan workers abroad and their families. Additionally, the government’s emphasis on diaspora remittances contributes to the stability of the country’s foreign exchange reserves, ensuring economic resilience in the future.

Photo Source: Google

By: Montel Kamau
Serrari Financial Analyst
9th September, 2023

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