MCP lawmaker asks Goodall to come clear on pension scheme

Member of Parliament for Lilongwe Mpenu Nkhoma, Collins Kajawa (MCP) has asked Minister of Finance, Economic Planning and Development Goodall Gondwe to come clear on the pension scheme.

“The Minister has ably defined government’s intention to resolve the issue of pensions and gratuities. However, he has not clearly defined how he will set aside the funds for the start-up pension scheme, and how long that will take,” Kajawa said in the House.

“We expect that the Minister should come out clear and be able to say, in year one, we will pay out K20 billion, for example, and so on and so forth, and say we will finish, for example, in year six; but this is not clear, it is open ended and that is a huge risk to this nation,” he added.

He also noted that that there is “a dual approach” on pension scheme.

“They are planning to contract the pension fund to pension administrators. At the same time, there will be some annuities to be administered by government. This is in contravention of the Pension Act 2010. That is not the way we should carry out this business,” he said.

Meanwhile, there have been pension discrepancies between civil servants who retired before 2009 will linger on until government starts implementing a national pension scheme.

One way to harmonise pension benefits, according to Gondwe, was to apply the average increase of pension contribution each time there was a salary increment in the civil service.