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Pension fund up by 1%

by Staff Reporter
14 May 2013 at 17:57hrs | Views
Employers and employees will pay more pension contributions to the National Social Security Authority (NSSA) after the raising of pension fund by one percent.

The development, to be effected in June, will see contributions going up from six percent to seven percent of insurable income, with half of the contribution coming from the employee and half from the employer.

In a statement, NSSA said the maximum insurable earnings limit has been raised from US$200 to US$700 per month, meaning that employees and their employers will each pay 3,5 percent of the employee's basic earnings up to a maximum earnings limit of US$700.

Individuals earning above US$700 will pay the same as those earning US$700.

Pensions are calculated on the basis of an individual's insurable earnings at retirement and contribution period.

Pension pay-outs have also been increased for individuals who retire with insurable earnings of US$700 after contributing to the pension scheme for over 18 years to more than US$172 a month up from just over US$49 from insurable earnings of US$200 a month.

An economist, Mr Morris Chiwanga said the move by the pension fund is commendable but added that more should done to cushion pensioners.

The new rates, which were gazetted last Friday, will take effect next month.

The minimum retirement pension will also go up from US$40 a month to US$60 from August while the minimum survivor's pension and invalidity pension will rise from US$20 to US$40 per month.

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Source - ZBC