The National Social Security Authority (NSSA) has reviewed upwards pension payouts following an outcry over the meagre stipends the authority was dishing out to the majority of pensioners.
The lowest earning pensioners will be getting $200, up from $80.
In terms of the current compensation framework for NSSA, pension payouts depend on contributions, since there is a ceiling on payouts, the highest-earning pensioners are getting about $2 000.
“The minimum pension has moved from $80 to $200 starting from this month,” said NSSA senior benefits officer Rodwell Jariremombe during an Insurance and Pensions Commission - ZimSelector workshop recently.
NSSA’s Accident Prevention and Workers’ Compensation Scheme has also been reviewed upwards.
“Our funeral grant, which is given when one passes on as a result of a workplace accident, has also been reviewed upwards from $300 to $2 000,” he added.
He said the review followed the completion of an actuarial evaluation that was carried out by NSSA over the past few months.
Following the ravaging inflation wiping away the buying power, pensioners were severely affected as they could not access cash for days after travelling to the cities. Some pensioners had to sleep in bank queues for days waiting to access cash.
The recent currency reforms left the pensioners worse off as the local depreciated against the US dollar most pension houses have not reviewed their payouts accordingly to retain the value they had during the multi currency era.
Most pensioners are on the defined contribution (DC) schemes whose benefits fluctuate on the basis of investment earnings.
On the other hand, a defined benefit pension plan assures a specified pension payment, lump-sum or combination thereof on retirement that is predetermined by a formula based on the employee’s earnings history, tenure of service and age.