Young civil servants pen Ministry of Finance over pension scheme

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Young civil servants pen Ministry of Finance over pension scheme
Young civil servants pen Ministry of Finance over pension scheme

Africa-Press – Malawi. Concerned Young Civil Servants have penned the Ministry of Finance demanding the withdrawal of mandatory pension contributions deduction and a refund of the whole deducted amount plus interest accumulated.

In 2017, the Government of Malawi through the Ministry of Labour with or without the knowledge of line ministries introduced a mandatory pension contribution scheme without any justification or consultation.

The idea was that all the employees who were below 35 years of age at that time working in government departments were supposed to be deducted a minimum of K5000 Malawi for the lowest grade adjustable upwards automatically according to grades and increment as a contribution towards their pension retirement package.

“The lowest paid is contributing K10, 140.00 per month as of this date. Those that were above the stated age limit were left behind. The stated amount started being deducted in such a hurry even before the forms were filled, before consultations were made, before justifications were presented. The assumption and promise was that after 5 years of consistent deductions, the young employee would access his/her money plus the interests accumulated thereafter and this is what convinced the young employees across the country being full of ambitions and ideas about their future. The firm that was taking custody of our money was Old Mutual according to the forms that were circulated a year later.

“The forms were signed while the deductions had already begun. Down the line, Old Mutual handed over the custody of the money to a certain firm called ZAMARA without even notifying the young employees either directly or through the line ministries, no circular was issued across all the line ministries to back up this idea. The real motive behind the hand-over of the custody of the money is best known to themselves alone as no public address was done as indicated above,” reads part of the petition.

According to the Labour Act of Malawi, employees are supposed to be informed in advance of any development taking place concerning their services by the employer be it promotion, demotion, retrenchment and anything new before that thing comes into fruition.

According to the petition, the deductions just begun without proper consultation, without any justification. “We suspect foul play on the deducted money, or else ZAMARA was just a scapegoat to siphon us of our hard-earned lean salary that is already not carrying any water in the current situation of high cost of living.

“Those that are above 35 years of age are not being deducted the said money yet both the young employee and the old employee will get a retirement package at the current constitutional retirement age of 60 when their time to retire comes. There is no any other clarification as to what distinguishes the two when it comes to their retirement package during their retirement period,” adds the petition.

The Young Civil Servants have demanded that ZAMARA or whichever a firm is responsible for the deductions of the so-called mandatory Pension fund should return all the money deducted to the young employees with the interests accumulated for the past five years calculated at the current interest rate and influenced by the current fluctuation of our currency.

They have also demanded that the deductions must be put to a halt after the refund of the deducted money up until thorough consultation and justification is made across all the departments concerned and the respondents should be the young employees themselves.

The employees also want to be given a chance to say whether they want that issue or not bearing in mind that majority of them are already under different insurance companies of their choice.

“We no longer need any clarification or any justification on the matter; all that we need is our money back and nothing else. Any justification what-so-ever should come only after the money has been returned back to the owners,” they further demanded.

Meanwhile, the Concerned Young Civil Servants have given the Ministry of Finance 14 working days starting from Friday, the 18th of November, 2022 and the ultimatum will elapse on Wednesday the 07th of December, 2022.

“After the period has elapsed, we will have no choice but take an unspecified action across the country. As bonafide citizens of this country, with all the rights attached, the young employees will have a liberty to exercise their freedom just to make sure that their say is put forward to the responsible officers and an intervention is accorded as soon as possible,” further said the concerned Civil Servants.

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