Non-monetary benefits ease pensioners’ woes

MR Tawanda Mugwadi (74), a pensioner, marvels at a herd of a rare breed of Boer goats as they drink water at a makeshift water drinking point at his Zhombe homestead.

The herd of five Boer goats, which is mixed with indigenous veld goats, is in its early stages and is growing by the day and Mr Mugwadi is constructing more pens for his new treasure.

Mr Mugwadi is one of the first beneficiaries of the knowledge transfer goat-rearing project, which is being implemented by the National Social Security Authority (NSSA) as a way of empowering pensioners and protecting them from inflationary pressures.

National Social Security Authority (NSSA)

In recent months, inflation has been wiping out their pensions.

The project is still at a pilot stage and has so far been introduced in Chinhoyi and Kwekwe. It is set to be rolled out across the country to benefit more pensioners.

Mr Mugwadi worked for a popular steel manufacturing company in Kwekwe for more than three decades as a driver until he retired.

What he is getting as pension has been eroded by inflation and the goat-rearing project therefore came at the right time. “I was listening to the radio one day when I heard about the goat project introduced by NSSA and I decided to make a follow-up,” he said in an interview.

Mr Mugwadi said he was looking forward to the success of the project because his pension was no longer enough for him and his wife.

According to NSSA, 102 464 pensioners are receiving pensions payouts every month.

About 24,3 percent of people aged 65 and above are receiving pensions through the Pensions and Other Benefits Scheme (POBS), which is mandatory.

Many companies have stopped contributing to private pensions schemes due to lack of confidence in the sector thereby putting both pensioners and workers in a precarious position.

Although pensioners are happy following the recent introduction of the US dollar component, it remains a drop in the ocean.

This has triggered pension companies into action as they look for non-monetary means to sustain the pensioners.

NSSA research and schemes planning manager, Mr Cosmas Chikwawawa, said the goat project was part of a number of non-monetary interventions meant to cushion pensioners from the hyper-inflationary environment.

He said pensioners should not over-rely on monetary pensions.

“There is a perception out there that the Pensions and Other Benefits Scheme (POBS) is the only pension fund that contributors should rely on for sustenance post-retirement.

“By design, it should not be the only source of sustenance. It’s designed to complement and be complemented by other schemes,” said Mr Chikwawawa.

For that reason, NSSA has introduced a number of projects to cushion the pensioners from the vagaries of a runaway inflation.

“We introduced a plethora of projects to support POBS, which is the mandatory social security scheme in the formal economy.

“Besides the goat rearing project, we have also introduced the revolving loan facility for pensioners to finance projects for self-sustenance,” said Mr Chikwawawa.

NSSA also introduced discounts of groceries and medical drugs for pensioners in partnership with selected supermarkets and pharmacies as well as scrapping off bank charges.

Mr Cuthbert Munjoma

The pensions authority has also introduced a mobile clinic so that pensioners have easy access to health care.

“These are supposed to empower pensioners because the role of NSSA is to build pensioners’ resilience,” said Mr Chikwawawa.

The inflationary climate has resulted in loss of confidence within the pensions industry hence the dwindling pension contributions from employers.

There is high non-remittance of pension contributions by employers, which has seen the figure of non-remitted pensions ballooning to $26 million as at September 2022.

Insurance and Pensions Commission (IPEC) pensions director Mr Cuthbert Munjoma also says pensions are not the only source of sustenance but are meant to be augmented. He noted that a raft of measures were being put in place to ensure that pensioners can smile all the way to the bank.

Insurance and Pensions Commission (Ipec)

“We continue monitoring and tracking the pension funds so that we ensure that pensioners are getting real value. We have also introduced what we call the ‘bread index’, which we believe is a simple way of determining real value,” said Mr Munjoma.

Bread index is simply dividing the amount a pensioner is getting by the price of bread. Mr Munjoma said despite the challenges, the pensions sector remains relevant both to an individual and to the economy.

To arrest non-remittance, Mr Munjoma said they are working on acquiring powers to garnish accounts of non-remitting companies.

Despite the challenges, pensions remain important to the economy as they are a source of financial capital for income-generating projects, which are key to the economy.-chronicl.c.zw