THE Zimbabwe Congress of Trade Unions (ZCTU) says Parliament should exercise its oversight powers to speed up the implementation of the Smith Commission of Inquiry recommendation for the compensation of pensioners whose savings are being eroded by inflation.
The ZCTU says, MPs must demand answers on eroded pensions
The inquiry was set up in 2015 to give the insurance and pensions industry a transparent process for addressing challenges encountered in converting pensions and insurance benefits from the Zimbabwe dollar to the United States dollar in 2009.
ZCTU secretary-general Japhet Moyo said Parliament has been slacking in pushing for the recommendations so workers can be compensated for lost value. The recommendations include compensation of pensioners and amendment of the Insurance Act to enhance disclosure and accountability by industry players to pension fund members.
“One would have expected that Parliament makes sure that commission outcomes are implemented. The commission was funded by the state resources and acted within the constitution, therefore it becomes the parliamentary role to make sure its recommendations are implemented,” Moyo said.
Moyo said while the ZCTU has been advocating for implementation of the commission of inquiry’s recommendations, little has been done by Parliament to push for their implementation, seven years on.
“We will continue to push the relevant authorities to ensure that the findings and recommendations are implemented. However, we have a Parliament that cannot execute its independent oversight power.
“The commission recommendations were accepted by the President and put before Parliament and they appear not to understand their oversight role. It is either someone deliberately made sure Parliament doesn’t act on the findings,” Moyo said.
The government has been currently at a standoff with Ziscosteel workers who are set to receive their pensions at a US$1:ZW$1 rate. This means a worker who had US$30 000 in 2017 would have ZW$30 000 in 2022. This translates to US$77.22.
The cost of living for a family of six jumped to more than ZW$75 000 in January 2022. The cost of living also maintained an upward trend between February and March, rising by 17.9%, according to the Consumer Council of Zimbabwe (CCZ).
Former Ziscosteel workers from Torwood in Redcliff said the depreciation in pensions is going to push communities into further poverty. The company used to employ close to 6 000 workers who were retrenched in 2016. These workers had their own employees who are dotted in the community, said workers who spoke to The NewsHawks.
Economist analysts say the government should take prompt action in fulfilling the commission of inquiry’s recommendations to cushion workers who have largely been affected by the conversion.
“If there is one sector of the population who deserve more residency from government, it is pensioners who throughout their working lives funded the government through taxes and pension contributions for long-term investment,” said Vince Musewe, an economic analyst.
He said the government should safeguard pensioners’ savings.
“Most of their savings have come to nothing because of sheer mismanagement of their contributions. Now when they need those savings most they get very little. You can judge the development of any society by the way it treats its pensioners.”
During the hyperinflation period, pensioners across all sectors who retired between 2007 and February 2009 lost their pension lump sums.
Upon demonetisation of the Zimbabwe dollar, pensioners only received as little as US$5 as their one-third lumpsum benefit, according to a 2018 report on the inquiry titled: “Report of the commission of inquiry into the conversion of insurance and pension values from the Zimbabwe dollar to the united states dollar.”