adminLocadia Mavhudzi Midlands Correspondent
Disgruntled pensioners from various companies and local authorities say they are now pinning hopes on the reforms being spearheaded by Insurance and Pensions Commission (IPEC) so that they can salvage meaningful benefits from their former employers.
IPEC has proposed amendments to the Pension and Provident Funds Act that will see decision-makers at companies that deduct but do not remit employees’ pension contributions being held accountable at law.
Speaking at a recent pension trustee’s workshop in Gweru, National Railways of Zimbabwe NRZ pensioner’s representative Mr Tarirayi Chinodya said NRZ pensioners are living in poverty yet their former employer has a lot of properties that were acquired from pension savings.
“We are now living in a sorry state, the earnings we receive is far less than the value of contributions we made when we were still employed. It is disheartening to note that we contributed for over 30 years and the company managed to purchase properties which today might be rented in foreign currency yet we continue to get peanuts,” he said.
Mr Chinodya said lack of access to pension benefits has resulted in health challenges for most pensioners.
“Our major concern is access to health services as you know elderly people are prone to various ailments. Currently, Railmed, our medical aid scheme is no longer being accepted anywhere. We are just pinning our hopes on the reforms being spearheaded by IPEC,” he said.
Mr Chinodya said NRZ pensioners have done everything in their capacity for their plight to be addressed but only received minimal attention.
IPEC director of pension Mr Josphat Kakwere said the pension reforms are meant to deal with challenges affecting the industry.
He said an average pensioner in Zimbabwe receives a pension well below the poverty datum line.
“We are working on reforms that might see fund members benefiting from their pension funds before retirement amid growing questions over the relevance of pension in a highly volatile economic environment.
“The operating environment has been characterised by weak corporate governance and high contribution arrears, high administration expenses, outdated legislation as well as unresolved loss of value issues,” he said.
Mr Kakwere said the prevailing situation could be remedied by higher contribution rates and higher investment returns.
He also suggested inflation indexed investment, hybrid schemes, and consolidation of pension funds as other possible remedies.
Research has shown that African pension funds are underutilised given their ability to set aside assets for investment.
Online Reporter