President Kibaki directed the Attorney General to re-draft the Bill to "ensure compliance with the Constitution and the law and to submit it and the accompanying explanatory memorandum to the Speaker with immediate effect".
The President's move will be welcome news to Kenyans who reacted with fury at the legislator's decision to award themselves Sh9.3m each as a golden handshake.
The proposed law also guaranteed MPs armed bodyguards, a state funeral and unfettered access to VIP lounges in all Kenya's airports.
The Bill also provided for diplomatic passports for the MPs and their spouses.
The move was greeted with outrage.
Prime Minister Raila Odinga, the Commission for the Implementation of the Constitution (CIC) and the Salaries and Remunerations Commission (SRC) rejected the send off package.
Mr Odinga slammed the MP's selfish move terming it a betrayal to Kenyans.
"The passage of these Bills amounts to treachery by Parliament. It is an attempt by MPs to blackmail, arm twist and even bribe the Executive in order to have their way," he said.
Mr Odinga said the MPs move will negate the achievements of the Tenth Parliament and the coalition government.
“The recommendations of the two Bills are unacceptable, unjustifiable and border on criminality,” said the PM.
CIC Vice Chairman Elizabeth Muli said the act amounted to the Parliament usurping the powers of the salaries commission.
“SRC is the only constitutional organ mandated to set and review remunerations for all state officers,” said Dr Muli.
The salaries team said the perks would unnecessarily burden on the taxpayer.
“It was untenable in October when the first perks were approved and it is still untenable now,” said SRC chairman Serah Serem. - Saturday Nation
