Contributory pension scheme angers teachers
Teachers Union of Malawi (Tum) has expressed anger and disappointment over a surprise move by government to implement a contributory pension scheme where five percent of civil servants’ salaries is being deducted.
Tum President Willie Malimba has told The Sunday Times that despite the programme being a welcome development, they have been saddened as their planning has been affected.
Malimba who is demanding an explanation from the government, said teachers are the least paid among civil servants arguing that financial matters such as these had to be communicated in time.
The least paid primary teacher takes home about K70,000.
“This is our salary and whosoever tampers with it has to offer explanations that is before effecting anything. Honestly, we have been taken by surprise and government owes as an explanations. We have been the management of the scheme.
“The board of trustees would comprise representatives from Teachers Union of Malawi, CSTU and Nurses Council and other councils within the civil service. The board has not been established though we sent them our nominees,” he said.
Other teachers such as Limbani Malubiya of Chisawani Zone in Thyolo District also shares disappointments.
“We are teaching in the rural areas and to use communication is very important. Life in the villages is very difficult and to find out that five percent is missing in your account that is a lot of money. I took an initiative to visit our district education offices to find out what had happened on the deductions and that was when I was told of the new scheme.
“We are not against the scheme but the implementation has not been done correctly. To say it straight my budget for this month (November) has been disturbed,” Malubiya said.
Another teacher said his salary for October has been slashed by about K13,000.
However, Ministry of Finance spokesperson, David Sado, said, in an earlier, interview the system has come into force following the new Pension Act that was passed by Parliament in July this year.
Sado said the new system is only applicable to civil servants of 35 years of age and below while the rest continue to remain on the old scheme.
“The new Pension Act among others provides for contributory pension scheme for civil servants. So from this financial year onwards, civil servants who are 35 years and below are contributing five percent of their salaries towards their pension fund,” he said.
Previously, the civil servants were not contributing anything towards their pensions and Sado argued the government was being overwhelmed to pay their gratuities.
He said on top of the five percent contribution by the civil servants, the government is paying an additional ten percent and administration fees to selected pension management firms for smooth management of the funds.
Commenting on why the teachers have been surprised with the scheme, Sado said the affected civil servants will be educated on the operations of the new scheme.
The contributory pension system provides for an opportunity for the civil servants to transfer their pension money from the civil service to wherever they go.
According to Tum at least 40,000 teachers have been affected with new pension scheme.
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