The Presidential Retirement Benefits Amendment Bill grants President Kibaki and his predecessor Daniel arap Moi a monthly pension, house allowance and a monthly entertainment allowance.
The law on presidential benefits intends to amend the Presidential Retirement Benefits Act of 2003 in order to take into account the inflation trends in the computation of the benefits payable to a retired president.
The Presidential Retirement Benefits (Amendment) Bill 2012 proposes that the president be paid a lump sum take-home of Sh12.6 million for every term served.
The president will also be paid pension at the rate of 80 percent of his final salary of Sh700,000 meaning he would earn Sh560,000 a month. In addition he will be paid 40 percent of the current salary as entertainment allowance which translates to some Sh280,000.
The president however rejected The Retirement Benefits (Deputy President and Designated State Officers) Bill 2012 which would have given MPs a hefty Sh9.3 million send-off package and sent it back to Attorney General Githu Muigai for review after legal queries.
The president declined to assent to the law since he had refused to sign a similar bill last year. The move by MPs to introduce the same amendments through another bill raised constitutional questions which must be resolved.
The rejected Bill had caused uproar among Kenyans and the civil society, who on Monday took to the streets to show their displeasure with the latest show of greed by legislators.
The gratuity was initially contained in amendments to the Finance Bill 2012, but the MPs sneaked it into The Retirement Benefits (Deputy President and Designated State Officers) Bill 2012 last week after the first rejection.
Calculated to cover the 222 MPs, the taxpayer would part with at least Sh2 billion to pamper the legislators.
Coming with the package would have been one armed security guard, diplomatic passport for both the MP and their spouses, access to VIP lounge at all airports within Kenya and maintenance expenses.
Among other crucial bills approved by the president on Monday are those that are key in the transition to devolved government.
They are the Transition County Allocation of Revenue Bill 2012, the Transition County Appropriation Bill 2013, the County Governments Public Finance Management Transition Bill 2013, the National Government Co-ordination Bill 2012 the Sport Bill 2012 and the Constituencies Development Bill 2012.