The revised National Pension Fund (NPF) is expected to be presented to the Ministry of Labour, Industrial Relations and Employment Creation next month, the Social Security Commission has said.
Social Security Commission (SSC) Manager of Communication and Marketing, Unomengi Kauapirura, told the Windhoek Observer this week that the revised policy is currently being updated.
The pension fund is expected to be fully implemented in 2019.
Kauapirura said in March this year that labour minister, Erkki Nghimtina and officials in his ministry reviewed the documents and further revisions were recommended, following a consultation and briefing session.
Based on the Labour Force Survey 2016, the total number of employed people in Namibia was estimated at 676,885. Of these, 42.1 percent or 285,416 were active members of existing pension funds.
“This means 391,469 employed people did not belong to any pension fund in 2016. However, 164 992 people were in vulnerable employment in 2016 and are unlikely to contribute to the NPF. Therefore, the maximum potential new members of the NPF is approximately 230,000,” Kauapirura said.
The draft social security pension policy has already been completed, together with the supporting Consolidated Technical Discussion Paper of December 2016.
Kauapirura said this was followed by a consultative workshop in May 2017 between the ministry of labour, Namibia Financial Institutions Supervisory Authority (Namfisa), SSC board and management, and consultants to review aspects of NPF policy and the design framework.
“It was this workshop that recommended that the NPF Consultant Team review specific aspects of the Design and Governance of the NPF,” she said.
The Harambee Prosperity Plan sets the explicit goal that a National Pension Fund be established on the basis that many employed Namibians are excluded from retirement fund arrangements.
Government already made provision for the establishment of the Fund as a mandatory contributory social security pension as far back as 1994, with the passing of the Social Security Act. However, the NPF has not been implemented.
“The Draft National Pension Fund Policy proposes to establish a Social Security Pension Scheme with the following vision, a Namibia in which all workers have effective access to affordable pension and disability benefits and their dependants to affordable survivor’s benefits in striving towards comprehensive social protection for all,” Kauapirura said.
The proposed pension scheme is expected to provide relevant old-age, disability benefits to all workers and survivor benefits to their dependants in the most efficient and cost effective manner. It will be funded by means of contributions from all workers and employers.
Kauapirura said the policy will have a positive impact on social insurance coverage, lifetime financial security, income redistribution, saving and investment and financial sector development.
“As a social protection tool, the envisaged National Pension Fund will ensure income security at old age, help participants to maintain a decent standard of living and help lift participants and their dependants out of poverty” she said.