US$6bn Zim pensioners’ swindle; Biti calls on Govt to push for compensation, minister says Cabinet seized with issue

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By Anna Chibamu

FINANCE Minister, Mthuli Ncube has been urged to enact legislation to operationalise recommendations by former High Court judge Justice Smith to compensate pensioners, who lost contributions worth US$5,86 billion.

Former finance minister and Citizens Coalition for Change (CCC) Harare East MP, Tendai Biti, told Parliament this week that Ncube must urgently craft the required legislation law in light of reluctance by insurance companies to redeem pensioners seven years after the recommendations were made.

The Insurance and Pensions Commission (IPEC)’s alleged lethargy, and greediness by insurance firms, had resulted in contributors losing hard-earned savings.

“I therefore make the point that the Finance minister (Mthuli Ncube) must, as a matter of urgency, come up with a law that puts into effect the Justice Smith Commission of Inquiry recommendations and secondly, that the same law must deal with the pensioners who have lost their USD savings, those who started making pension contributions from 2009 in USD including Honourable Members of this august House,” said Biti.

According to the legislator, Justice Smith’s recommendations must be implemented urgently to restore sanity and confidence in the insurance and pensions sector, which has lost credibility as beneficiaries who made losses due to inflation were wallowing in abject poverty.

Opposition Citizens Coalition for Change legislator and lawyer Tendai Biti

“My point of national interest relates to pensions. As you know, in March of 2007, the Justice Smith Commission of Inquiry into conversion of people’s pension funds presented its report,” he said.

“That report made several recommendations after finding that Zimbabweans had lost pensions to the total value of USD5,86 billion as a result of a weak regulatory framework by IPEC, the Insurance Pension Commission of Zimbabwe, the scandalous and greedy behaviour of insurance houses and terrible macro-economic environment, including inflation that had risen to 500 billion percent,” Biti said in Parliament.

He added: “So effectively, Justice Smith recommended that there be compensation for pensioners, teachers, headmasters and workers who had worked from 1980 and served through their pensions but their pensions were wiped out. Six or seven years later, those recommendations have not been put into practice.”

The legislator also spoke about another group of pensioners who had been affected by the 2019 enactment of Statutory Instrument (SI) 33.

“These people saved their money from 2009 when the economy had dollarised, paid their pensions in USD, but suddenly after February of 2019, with the enactment of Statutory Instrument 33 of 2019, greedy pension houses like Old Mutual and First Mutual are now paying those pensioners in paltry ZW$.”

Deputy Speaker Tsitsi Gezi advised Biti to bring a motion to Parliament concerning the issue for debate and adoption thereof.

Public Service Minister, Paul Mavima in an interview with Thursday, said Biti’s sentiments have already discussed at Cabinet level and pensioners were set to be compensated.

“The Finance minister is seized with this matter which has been handled at Cabinet level. I know for sure that the Finance minister is working on it and soon we will see recommendations made by the Justice Smith Commission of Inquiry being implemented by the insurance companies (funds catering for private employees under IPEC).

“As for the National Social Security Authority (NSSA), we, as government, are paying pensioners and benefinaries at international rates and we are meeting the targets.

“Yes, the macro-economic situation is not favourable to give a decent living for our pensioners, but soon our economy will improve and we hope we will get out of this economic quagmire so that the social protection fund covers our pensioners,” Mavima said.