Africa-Press – Namibia. THE finance ministry has announced that the regulations that would allow retirement funds to preserve 75% of pension benefits until one is 55 will no longer come into effect on 1 October this year.
This announcement comes two months after the consultations on regulations to be passed under the Financial Institutions and Markets Act were concluded, and recommendations were made to the finance ministry.
Finance minister Iipumbu Shiimi is supposed to approve the regulation, but it appears he is getting cold feet.
Regulation RF.R.5.10, as it is known, will make it compulsory that upon retirement before the age of 55, employees can only access 25% of their retirement savings.
It further suggests that only when a person turns 55, will they receive the remainder (75%) of their pension credit, and not as a lump sum, but in monthly payments.
The retirement funds industry had an asset base of N$201 billion at the end of October last year.
At the announcement that the regulation was to become a law, the finance ministry and the Namibia Financial Institutions Supervisory Authority (Namfisa) faced resistance from stakeholders, who said they were never consulted.
Some asked for the findings informing the 75:25 ratio to be made public, a request Namfisa has denied.
Last Friday, Shiimi announced that the implementation of the regulation will now be postponed to an unknown date “to allow further consultations to take place”.
No date has been given on the time frame of the envisaged consultations.
“It will be until the consultations are done,” said ministry spokesperson Wilson Shikoto.
Reacting to the announcement, many took to social media to say the government should stop jumping the gun and implementing regulations when no proper consultations were done.
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