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Leonard Ncube Victoria Falls Reporter
GOVERNMENT is working on setting up a commission of inquiry to probe pension funds over the conversion rates they used from the local currency to the United States dollar when the country dollarised in 2009 that resulted in pensioners losing their investments, a cabinet minister has said.
The move is likely to bring smiles to thousands of pensioners.
The issue of money lost through investment into pension funds and insurance during the hyperinflation era took centre-stage during the 39th annual congress of the Zimbabwe Association of Pension Funds in Victoria Falls on Friday.
Participants demanded to know what measures had been put in place to retain confidence.
Officially opening the congress last week, Finance and Economic Development Minister Patrick Chinamasa said his ministry was in the process of reviewing the legal framework regarding governance of pensions to enhance protection of members.
“The introduction of the multiple currency regime entailed the conversion of insurance and pension fund assets and liabilities to United States dollar denominations and many active pension fund members and pensioners were disappointed by the low values allocated to their pensions and insurance policies,” said Minister Chinamasa.
He said this has contributed to lack of confidence on the sector hence the need for a review process.
“People are coming to complain about lost pension values since the hyperinflation period. My ministry is working with the Insurance and Pensions Commission to update the regulatory framework to capacitate the regulator to adequately perform functions.
“The low values have become a major source of low confidence and this has created a perception that pensioners incurred losses while pension fund managers preserved the value of their assets. In this regard, we are working on establishing a commission of inquiry into the conversion process following the actuarial investigation into the same matter whose findings are still under consideration,” said Minister Chinamasa.
He said there would also be review of the Banking Act to guard against abuse of depositors’ money.
Participants demanded to know how soon government intended to review the framework as the matter had been on the cards for many years.
Some challenged the minister to look into some infrastructure such as buildings funded by pension money yet pensioners, are being paid as little as $30 per month.
The minister said there was a need to equip trustees with knowledge as most of them had no capacity to deal with the issues at hand hence companies went unmonitored.
Commenting on ‘‘panic’’ caused by fears of the return of the Zimbabwe dollar, Minister Chinamasa said, “The multicurrency regime is here to stay because we cannot print money overnight. I am the one who introduced multicurrency after consultation and the nation will not be ambushed when new currency is being introduced.”
Hundreds of members from different pension fund companies, actuaries and trustees are attended the congress which ended at the weekend.
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