|
||||||
|
|
|
|
|
|
|
|
|
 |
 |
 |
 |
|
 |
Inflation
Wipes Out Pensioners Income Ruth
Butaumocho, The Herald (
Inflation
has eroded the value of their pensions so much that most now rely on
handouts. Some pensioners have even stopped collecting their payouts. The
bus fare to collect the money is more than what is paid. Most
of those in destitution have pensions ranging from ZWD $900 (1000 Zimbabwe
Dollars = $1.25 USD, GAA) to a maximum ZWD $90 000 a month. These pensions
cannot match escalating prices, being pushed by inflation, which has
reached a staggering 455 percent. Mrs
Lillian Matangaidze (60) a widow receives a ZWD $2 450 monthly pension
from her late husbands' scheme managed by National Social Security
Authority. She
cannot even buy a bottle of cooking oil or, worse still, buy her monthly
supply of antibiotics for her arthritis, which continues to worsen by day. She
has since stopped collecting the cheques, as the money she has to use for
bus fare is much more than her pension. "Its no use, the money is too
little," she says resignedly. Mrs
Matangaidze considers herself lucky because she lives in the rural areas,
unlike thousands of pensioners in the cities today who, are living from
hand to mouth. Mr
Poison Ngorovhani of Rugare, "The
money that I am currently getting is not even enough to meet city
council's monthly rent of over ZWD $5 000. Ndirikutambudzika (I am
suffering)," he said dejectedly. The
plight of his friend, Mr Gibson Mavai, who also worked for the NRZ for
more that 20 years, is more desperate. "NRZ deposits my monthly
pension of ZWD $1 745 in my bank account, but part of the money is
swallowed up by the ledger fees and other bank costs, leaving me with ZWD
$1 000. I usually go back home by foot after drawing the money, so that I
can save something." Another
pensioner, who retired after working for 20 years for a plastic
manufacturing company, Mr Douglas Dumba, regrets taking early retirement.
His pension is a paltry ZWD $1 500 from NSSA, which he says is a mockery,
as he cannot even afford to pay rent for his four roomed house in
Kuwadzana 4. He
cannot meet his medical expenses and dietary needs after being diagnosed
with ulcers. Faced
with a bleak future, pensioners in urban areas now survive by subletting
their rooms, engaging in urban agriculture and vending, while those in
rural areas have turned to gold panning and subsistence farming. Most
pensioners are irked by the fact although prices are increasing rapidly,
pension firms have done nothing to increase penions. NSSA
general manager Mr Amond Takawira said inflation had smashed purchasing
powers of most pensions and and those from his organisation were no
exception. But
the benefits from NSSA were favourable compared to most other schemes. Benefits
are affected by the contributory period, which at the moment is still low.
"While employee contribution rates to other pension schemes range
from 7,5 percent to 15 percent of the employee's salary, in NSSA the rate
is fixed at 3 percent of the insurable earnings with a ceiling that is
reviewed periodically but set very low. Currently it is pegged at only $48
000 per month." NSSA
retirement pensions ranged from ZWD $777 to $34 380 whilst invalide
pensions ranged from ZWD $337,50 to a maximum of $6 715. Survivors'
pensions, based on retirement pensions, ranged from ZWD $337,50 to $13
752. NSSA
pensions were being reviewed with an increase expected once the actuarial
valuation had been completed. An
economist, Mr David Mupamhadzi, said the surging inflation had had a
serious impact to people with fixed incomes. "Most pensions and other
forms of fixed incomes have lost value and will continue to do so owing to
inflation. "As
a result most employees are now reluctant to rely on pensions, as was the
case a few years back, where one would stay with one company for 10 years
in view of accumulating a sizeable pension," he said. Because
of the high levels of uncertainty surrounding pensions, many employees no
longer stayed in the same employment for too long. "Pension
is no longer an incentive to any employee who is serious about life,"
says Nesbert Siriro a stores controller with a company which specialises
in irrigation equipment. One
of the many ways that the Government could assist pensioners and other
people with fixed incomes would be to come up with policies that ensured
companies reviewed pensions in line with inflation.. The
Government could implement a policy similar to that of insurance companies
where premiums were constantly increased to match inflation. Insurance
companies, after realising the danger of having people's earnings being
eroded by inflation have put in measures to add a certain percentage of
the monthly contributions as an escalator to guard against such a
situation. Although
the percentage might not be high enough to beat the inflation, it could
cushion the contributors. Mr
Mupamhadzi urged companies to invest pension funds so they could realise
attractive profits, which in turn would be paid to pensioners. "Some
pension firms are failing to make proper payments to pensioners because
the money was not properly invested. There is need for policy makers to
scrutinise operations of some pension firms in the country," he said. For
several decades pension funds have been forced to invest significant
percentages of their income in Government bonds. These provide absolute
security, but the returns are traditionally lower than shares or property. Although
the living conditions of pensioners were deplorable in The
It
had set up successful partnerships between central and local governments
and the voluntary sector to improve lives of pensioners through provision
of heavily subsided accommodation, food and entertainment allowances. Pensioners
in the A
situation closer home is that of A
report by the UK based Institute of Development Studies compiled this year
showed South Africa had over 1,6 million social pensioners, each receiving
R600 (US $60) per month. Namibian
pensioners had 85 000 pensioners each receiving a much lower figure at N$
250 (US $24), compared to Botswana's 110 pula (US $17), which is paid to
80 000 individual social pensioners each month. In both Apart
from pensioners themselves, the social pension supports unemployed adults,
young grandchildren and other relatives. It
had also contributed to high numbers of 'missing middle generation'
households in rural communities. Copyright
© 2002 Global Action on Aging |
