By Chisomo Phiri
Human Resources Managers from different working institutions in the country have been urged to provide clear explanations on the Pension Act which came into action on April 1, 2023.
Speaking on Friday during Pension Act awareness workshop held at Amaryllis Hotel in Blantyre, Human Resources Society of Malawi (HRSM) Secretary General Robin Kajasiche said, there is a need for Human Resources Managers from various organizations and companies in the country to be enlightened on how best they can explain to their employees some of the provisions contained in the 2023 Pension Act to avoid confusions.
Kajasiche told the Human Resources Managers to always adhere to the provisions in the pension act, saying that is the only way to escape the penalties which are in the new law.
“This workshop aims to equip employers or Human Resources Managers who are the trustees from various offices to do what is required by the legislation.
“We had the Pension Act 2010, so, we are enlightening each other what is in the new pension act which started in March this year, so that no one should lag behind.
“This is a legislation, companies and organisations that are employers, whether we like it or not, we have to make what the legal provisions are saying.
“If they have challenges, they have to take it up with the authority thus the Reserve Bank of Malawi. If they just choose to default, penalties will be meted out on them,” said Kajasiche.
Kajasiche further said he is impressed with the provisions contained in the 2023 Pension Act saying they are providing financial security to the dependents.
On his part,Reserve Bank of Malawi Chief Examiner responsible for Non-Prudential Compliance, Pension and Insurance Supervision Edwin Mulenga commended HRSM for organising the workshop which he said has helped the central bank to reach out to the public on the new act.
“These engagements are critical because it is also helping us to sensitise employers or human resources managers on new provisions that have been incorporated in the Pension Act (2023). With the penalty put on as higher as K150 million, we expect enhanced compliance with the pension legislation,” said Mulenga.
On her part, one of the workshop participants, a Human Resource Planning Officer in the Ministry of Mining Mphatso Luwanika also commended HRSM for the workshop saying it has helped her to gain knowledge on what 2023 Pension Act is.
“We have gained a lot and I hope we will now be able to have a detailed explanation of what the Pension Act is to our employees,” commended Luwanika.
Among others,the new Pension Act contains provisions such as an option for an employee to belonging to both the mandatory scheme and the voluntary scheme or just the mandatory scheme and the retirement age are determined by condition of service as opposed to the previous fixed retirement age.
Again, waiting period for access of part of pension for someone that has lost a job is reduced from 6 months to 3 months and the person will be able to access 100 percent of what they contributed.
The new law also stipulates that those retired should be able to access 50 percent of the total contributions including interests accumulated at once and an employee should also be allowed to access 50 percent of total five years prior to retirement which is expected to help people prepare for retirement.
