By   REBECCA MUSHOTA –

GOVERNMENT is working on a Bill that will harmonise the operations of the pension scheme institutions to make it viable and address the challenges of pensioners, Public Service Division Permanent Secretary Velepi Mtonga has said.
Dr Mtonga said there were technical committees that had been formed and mandated to come up with a legal framework that would harmonise the operations of the National Pension Scheme Authority (NAPSA), Local Authorities Superannuation Fund (LASF), and the Public Service Pensions Fund (PSPF).
The committees would then come up with a Bill that would be presented to Parliament.
This was been done in order to address longstanding challenges like inadequate pension payments and introduce new payment systems.
Dr Mtonga said this when she appeared before the Parliamentary Public Accounts Committee (PAC) which was chaired by Choma Central Member of Parliament (MP) Cornelius Mweetwa to respond to queries raised in the 2013 Auditor General’s Report on the operations of the PSPF.
The AG’s report said the PSPF was an insolvent pension fund with unsustainable contribution and benefits structure.
The contributions received in the fund were lower compared to the benefits paid especially considering that two thirds of a retiree’s benefits were to be paid immediately a person retired.
PSPF was closed to new entrants and revenue has since declined since the introduction of NAPSA in 2000 and the scheme also had a small investment portfolio.
Currently, the PSPF had assets worth K1.1 billion compared to liabilities worth K24.4 billion.
“Government has embarked on pension reforms aimed at creating a sustainable and affordable pension system that will address the challenges and the plight
of pensioners, retirees and beneficiaries,” Dr Mtonga said.
She said the reforms would target income replacement ratio that would reduce the lump-sum paid upon retirement and increase of monthly payments.
The pension laws would be revised and a worker would have benefits from NAPSA, LASF and a private scheme.
The retirement age for new entrants would be revised to 60 with an option of retiring at 55.
Lubasenshi independent MP Patrick Mucheleka wondered if the reforms were not an excuse to avoid paying pensions and transferring the burden to workers.
Chama North Patriotic Front MP January Zimba said the revising of the retirement age would affect the unemployed youths.
Dr Mtonga said the reforms would have positive effects on the pension funds as well the workers.
She said the retirement age would not affect youth unemployment considering that the civil servants who were 200,000 were of an average age of 37.
Dr Mtonga, however, said consultations on the matter were still underway.