By CATHERINE NYIRENDA –

THE Local Authority Superannuation Fund (LASF) has appealed to Government to open up the Scheme to new members to save the company from collapse because of its K505 million deficit.
The Fund has accrued pension liabilities for active members and pensioners amounting to K623.92 million against its total assets worth K119.39 million.
Local Government and Housing Permanent secretary Stanford Msichili said this when he appeared before the Public Accounts Committee (PAC) chaired by Alliance for Democracy and Development Member of Parliament (MP) Getrude Imenda.
Mr Msichili said if Government does not reverse the policy, the Fund will wind up as it is insolvent and is unable to pay its pension liabilities.
“The major cause of this position is as a result of the of Government policy  to close the scheme to new members from February 1, 2000 and the impact is being felt 15 years down the line,” Mr Msichili said.
At the time Government decided to close the scheme to new members, LASF had 18, 000 contributing members who have since declined over the year to 5,055, with 10, 842 pensioners.
“The solution is for Government through the Ministry of Finance to adopt a suitable payment plan of either 5 years or 10, or 15 or 20 years and finance the actuarial deficit through the national budget”.
He said another source of worry to the Fund is the continued defaulting by local authorities in contributions with outstanding amounts reaching K75, 028, 826 as of 2013 from K35, 574, 805 in 2010.
Mr Msichili said with the Fund failing to meet its obligations, it has come under increased incidences of litigation, which is further paralysing operations.
MMD Chembe Member of Parliament Mwansa Mbulakulima said LASF and the Public Service Pension Fund (PSPF) would continue to suffer deficits until policy direction by Government is found.
He said it is unfair for the committee to continue questioning the management of the two institutions on the causes of the deficits, when the issues were as a result of policy direction.