BY FIDELITY MHLANGA
ABOUT 1,8 million workers have fallen out of the National Social Security Authority (Nssa) pension scheme in the past few years, official data showed on Thursday, as authorities blamed Zimbabwe’s industrial carnage for the crisis.
Nssa deputy director for social security Tambudzai Jongwe told reporters that at its peak, the state-run compulsory pension scheme managed 3,2 million active accounts.
However, 1,4 million active accounts were currently under Nssa’s stewardship, Jongwe said.
While the industrial bloodbath has been felt since bad policies unsettled the key agricultural, manufacturing and mining sectors from 2000, job market turmoil reached tipping point between 2011 and 2013 after 4 561 companies collapsed, throwing 55 000 staff into the streets.
Thousands of graduates have been churned out of the tertiary education system during the period, never to find formal jobs.
While many have entered the hugely expanding informal sector now estimated to be controlling 60% of Zimbabwe’s economy, millions more have been hounded out of the country by the blazing economic crisis.
Jongwe said Nssa was worried about high levels of social security exclusion, and its implication on future generations.
Nssa is now working with the International Labour Organisation (ILO) to track down the estimated 5,7 million people in the informal sector to encourage them to sign up for the pension scheme.
Jongwe said under the plan, those willing can be covered by the first quarter of 2022.
She said while workers were supposed to contribute to the fund for 40 years, the bulk of its contributors have been paying for between 10 and 15 years.
This falls short of the recommended four-decade contribution tenure.
“The challenge that we face as a social security fund is that we are employment based and the number of our contribution base has been shrinking because of company closures and retrenchments,” Jongwe said
“We actually have 1,8 million inactive contributors. These are the people that worked for (companies like) David Whitehead and because of economic hardships they stopped working, but they are already a liability to NSSA because they are registered to us.”
“As Nssa, we are taking this issue of exclusion very seriously. We are currently covering only 24% of the working population and the remaining, as you know, there has been a ballooning informal sector.
“We have 76% of our working populace in the informal sector, who are not covered by any form of social protection. So as an authority we are extending coverage to the informal sector and we are working with the International Labour Organisation for technical guidance. We are hoping that by 2022 first quarter we will have our fully fledged voluntary informal sector scheme running.”
NSSA, which was established in 1994, with the mandate of administering and managing social security in Zimbabwe, has been covering four schemes for the past 27 years.
It has not been able to cover five other mandatory schemes as prescribed by the ILO.
The four schemes that Nssa is currently covering are old age, invalidity, survivor and employment injury schemes.
“One of the opportunities that we have is that of extending social security coverage both in terms of numbers of contingencies (schemes), as well the demographic number, mainly focusing on our informal sector that is currently excluded,” said Jongwe.
“For the past 27 years we have not managed to introduce any new schemes. We started off with four contingencies that we are covering and we are still covering those four. But our wish is to ensure that we cover the five remaining contingencies so that we have a more comprehensive social protection in Zimbabwe.
“But you will all agree with me that the economic challenges that the country faced in the past two decades were one of the reasons why we haven’t been able to extend our branches of social protection. As things stabilise, I am sure we will start covering other contingencies that we are still not covering.”
The authority is currently paying out pensions to 230 000 beneficiaries under the Pension and Other Benefits Scheme and the Accident Prevention and Workers Compensation Scheme.