Thousands of Malawians that have lost jobs, some due to the impact of the Covid pandemic, have been rendered destitute despite having millions in pension funds, a development blamed on pension laws.
The development has riled some pensioners, who have formed the Pensions Act Amendment Movement (PAAM) with the aim of pushing for the revision of the Act.
According to Section 65(a) of the Act, members can only have early access to their contributions when they have not secured another employment for a period of more than six months.
PAAM National Coordinator Aubrey Duwa confirmed the development, saying, because of the long time taken to get dues when the time comes to access pension benefits, the ex-employees are forced to get loans with exorbitant interest rates.
Duwa said, as a result, most pensioners have been left with empty pockets; as such, they cannot make sound investments.
He said the movement proposed an amendment to the Pensions Act so that people could access funds as soon as calculations are done by insurance companies— which is within four weeks, at most.
“We petitioned Parliament in August last year through Hon John Bande, who presented it to Parliament. Deputy Speaker of Parliament Honourable Madalitso Kazombo has been in-touch with PAAM and assured the leadership that the petition would be deliberated upon during current meeting.
“We are, however, concerned that the august House will rise on March 26 and, all of a sudden, there is a complete blackout on the issue,” Duwa said.
In an interview, Bande said the petition was overtaken by events at the time when it was presented to the House because the government, through the Ministry of Labour, was coming up with an Amendment Bill to take into account some of the concerns raised in the petition.
“However, the petition is still live on the floor of the House since it was referred to the Budget Committee and Legal Affairs Committee of Parliament. They will bring a report once they are ready,” he said.
Before the report is presented, Speaker of the National Assembly Catherine Gotani-Hara cannot act on the petition.
The Employers Consultative Association of Malawi (Ecam) estimated that between 274,000 and 680,000 Malawians could lose jobs if the Covid pandemic would not be over by the first quarter of 2021.
Ecam Executive Director George Khaki recently said the government should revisit monetary and fiscal policies that enable companies to have more money to maintain employment and to enable employees that have lost jobs to have incomes through extended social protection programmes.
In its December 2020 Financial Stability Report, the Reserve Bank of Malawi said, since the onset of the Covid crisis in March 2020, employers have had to lay off staff or reduce productivity levels due to lack of, or reduced, business opportunities and economic activity.