Online Reporter
THE second edition of the Public Service Retirement Conference ended in Bulawayo yesterday after three days of discussions on how civil servants’ tomorrow can be secured today.
This was a very important event which asserts the Government’s commitment, through the Public Service Commission (PSC), to build capacity to ensure that civil servants can look forward to retiring, and doing so into comfort, not poverty.
Indeed, the Government is doing very well in doing so well ahead of its workers’ retirements through affording them opportunities and the ideal environment for them to develop themselves so they can play individual roles in securing their futures. It has a number of initiatives through which its workers can buy vehicles, secure residential stands and so on.
However, the greatest amount of work is being done by the Public Service Pension Fund (PSPF), which is managing retirement savings and pension benefits for civil servants. It is building a robust investment portfolio, for now anchored on real estate. It has developed, is developing or has bought multiple properties across the country.
Recently it spent $18 million to buy Monomotapa Hotel in central Harare, arguably the crown jewel of its expanding portfolio.
Other investments include renewable energy projects, infrastructure and so on. By mid-May, the fund was managing assets worth $600 million, amassed since its founding in 2018.
These are solid investments that will surely bring strong returns to the fund, and by extension, to retired civil servants.
The way the PSPF is building its asset base is similar to what serious private sector pension funds have been doing for ages — National Railways of Zimbabwe Pension Fund, Zesa Pension Fund, Mining Industry Pension Fund, Econet Group Pension Fund etcetera.
We commend the PSPF for what it has been doing over the past seven years and are confident that with time and judicious decision-making, the fund will grow to become the most dominant one locally taking into account the size of its membership and amount of contributions. Investing in listed and unlisted equities, fixed income and so on like South Africa’s Public Investment Corporation whose asset base was valued at $135 billion by May last year.
What the Government is doing through the PSC and the PSPF must be a lesson to some local private sector employers which do not have pension funds for their employees. On this note, we emphasise that it would be great if the Government came up with a law making it mandatory for every company operating formally in the country to have a pension fund for its workers.
While essential and reassuring, a formal pension offers just one revenue stream upon retirement, an income that may be inadequate for one to live on comfortably. Bearing that in mind, we implore workers in the private and public sectors to prepare for their retirements by investing in the same manner formal pension funds are doing — in diverse portfolios with exposure to real estate, equities, fixed income assets, businesses and so on.
