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Zimbabwe govt urged to dollarise pensions

by Staff reporter
27 Dec 2023 at 07:32hrs | Views
THE Zimbabwe National Union of School Heads (Zinush) has pleaded for the dollarisation of pensions as inflation continues to eat away the life savings of educators, condemning many to poverty after years of loyal service.

In a statement, Zinush secretary-general Munyaradzi Majoni said pensioners were living miserable lives.

"We noted that this problem was caused by the model where salaries were in RTGS and only allowances were paid in US dollars and we sent our recommendation to the employer lobbying for the dumping of payment of salaries in RTGS (Zimdollars)," Majoni said.

"We raised concern on why our retiring members were getting retirement packages in useless RTGS terms regardless of the fact that these members once made their pension contributions in hard currency."

In November this year, the government came under fire from legislators over the meagre pension payouts to retirees.

Senators expressed concern over the plight of pensioners who are struggling to make ends meet.

Early this year, legislators implored Finance minister Mthuli Ncube to craft a law that operationalises the Justice Smith Commission of Inquiry into the loss of value of pensions.

The Justice Smith Commission, set up in 2015, was led by retired judge Justice George Smith to inquire into the loss of pension values and propose remedies to the crisis.

Majoni said civil servants were demanding an urgent review of the pensions to ensure pensioners live dignified lives.

"Our recommendation, as was espoused in our May Day statement to the employer, was that we start with converting the US dollar allowance to a salary so that pension emoluments could be in a more stable currency," Majoni said.

Finance minister Mthuli Ncube announced in his 2024 budget statement that United States dollar allowances for civil servants will now be taxed to ensure they receive part of their pension in forex.

Majoni welcomed the development.

"However, we take this as a case of too little too late. In the shortest possible time, our salaries and allowances must be entirely in hard currency so that we get value for our hard labour," he said.

Public Service ministry secretary Simon Masanga noted the concerns of the educators when contacted for comment.

"It is a PSC [Public Service Commission] issue. They house the government pension fund," Masanga said.

Majoni also complained about the implementation of payment of tuition fees for children of educators saying it was discriminatory.

"Zinush acknowledged the introduction of the facility but immediately voiced its concern on the implementation matrix which was both discriminatory (requiring that one needed to have children in school) and laborious (as it involved submission of invoices every term among many other processes)."

Source - newsday