The Retirement Benefits Authority will start penalizing employers who fail to remit employees deduction from January next year.
RBA chief Nzomo Mutuku says the authority may seize properties owned by the defaulting institutions on top of financial penalties.
More than one hundred public institutions are behind in remitting their employees statutory deductions running into several billion shillings risking the lives of retirees.
Public universities are the hardest hit with dues running into several billion shillings dating back to more than five years.
Last year the national treasury amended the retirement benefits act to punish employers who fail to remit statutory deductions.
According to the act, employers face a penalty of five percent of the unremitted contributions or Sh20,000 whichever is higher.
RBA chief Nzomo Mutuku says chief executives of the pension schemes who delay remitting audited reports to the regulator three months after the close of a fiscal year will be slapped with a 100,000 fine plus 1,000 shillings every day they are pending.
Speaking during the launch Fahari retirement plan Nzomo further says, the delayed rollout of the civil servants contributory scheme will be implemented starting next year with treasury expected to appoint a board of trustee to manage the fund.
Fahari plan is a pension scheme targeting domestic workers and unskilled laborers.