ZW$616 million in pension benefits lies unclaimed

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  • Unclaimed benefits accrued by 1900 percent in 2020 compared to 2019
  • IPEC says this as a consequence of lack of knowledge on the part of beneficiaries
  • Overall pensions industry income surged by 72 percent

Harare – The insurance and pensions commission (IPEC) says it is holding over ZW$616 million in unclaimed pension benefits for the year ended 31 December 2020.

The amount of uncollected benefits for the year 2020 represents a 1 900 percent increase on the 2019 figure of ZW$31 million, a surge which was driven mainly driven “revaluation gains and previously omitted unclaimed benefits which are now being reported,” according to the IPEC’s fourth quarter pensions fund report.

The issue of unclaimed benefits has been going on for years and IPEC has constantly attributed it to a lack of knowledge on the part of beneficiaries.

 As such it has called on pensions industry players to firstly make sure concerned data is made available quickly and run awareness campaigns for the good of ignorant beneficiaries.

“The Commission calls upon the industry to sanitise their data to improve data integrity. Additionally, the industry is urged to enhance awareness initiatives and come up with measures to track beneficiaries of unclaimed benefits.”

IPEC are also of the view that the accrual of unclaimed pension benefits is a result of poor corporate governance on the part of industry players.

“There is also the issue of undefined roles of players in the pensions industry resulting in certain players acting outside their mandate, for example, professional fund administrators underwriting annuity business and even acting as fund managers,” IPEC official Josphat Kakwere said speaking Zimbabwe Association of Pension Funds (ZAPF) annual congress.

Meanwhile, Total income for the industry for the year 2020 came in at $79,21 billion representative of a 72 percent surge compared to the $22,27 billion reported in 2019, also mainly driven by fair value gains, interest on investments and contributions, which constituted a combined proportion of 93,88 percent

The number of registered pension funds in the industry stood went down to 967 as at 31 December 2020 compared to 1 067 in 2019 while total membership, excluding beneficiaries, rose from 808 635 to 881 330 for the period under review translating to an increase of 8,99 percent.

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