By Alois Vinga
A total ZW$3,4 billion pensions attributable to the Clothing Industry Pension Fund (CIPF) remain unclaimed 14 years later raising concerns on the traceability of members, Insurance and Pension Commission (IPEC) has revealed in a quarterly update.
The regulator says about 95% of the unclaimed benefits have accrued for over 10 years, raising concerns on the ability of the funds to trace and pay the eligible members.
“It is noteworthy that out of the ZW$3,8 billion in unclaimed benefits under the stand-alone funds, ZW$3,4 billion due to 89,088, members are attributable to the CIPF alone.
“The unclaimed benefits have remained due for over 14 years, raising concerns on the traceability of the members,” said IPEC.
It is noted that total unclaimed benefits for the quarter-ended 30 June 2022 amounted to ZW$4,3 billion, compared to ZW$4,4 billion reported as at 31 March 2022.
Total membership with unclaimed benefits for the period was about 106,000, compared to about 146,000 as at 31 March 2022.
The decline in unclaimed benefits is however attributed to payments made to members as well as transfers to the Guardian Fund by some funds.
“An analysis of the unclaimed benefits data revealed that stand-alone funds have the largest proportion of unclaimed benefits, accounting for 90%, translating to about 96,000 members. On the other hand, insured funds and self-administered funds accounted for 8% and 2%, respectively.
“About 86% of the unclaimed benefits had accrued over a period in excess of 10 years, raising concerns over the traceability of the members entitled to the amounts.
“It also raises compliance issues, given the requirement to transfer unclaimed benefits aged over five (5) years to the Guardian Fund Guardian Fund under the Master of the High Court,” said IPEC.
For insured funds, the bulk of the unclaimed benefits were aged below five (5) years accounting for 78% of unclaimed benefits pointing to the continued challenge of data integrity amid plans that IPEC will continue to engage the funds to ensure that the members are traced and paid their benefits.