Home » General » Grant Paid to Contributors Not Eligible for Pension [column]

Retirement grants are paid to national pension scheme members who are eligible for a retirement benefit but have contributed to the scheme for less than the minimum 120 months required for a retirement pension.

Every contributor to the pension scheme who has contributed to the scheme for at least 12 months is entitled to a retirement benefit on retiring after the age of 60 or on reaching the age of 65, even if still working then, or on retiring at age 55, if seven of the previous 10 years were spent working in an occupation categorised as arduous.

However, only those who have contributed for at least 10 years receive a retirement pension. With the pension scheme now more than 20 years old, more and more people are likely to have met that minimum requirement by the time they reach retirement age.

For those who do not, there is the retirement grant, which is a lump sum payment. The amount of the grant, like the amount of the pension, depends on a person’s contribution period and insurable earnings at retirement.

However, while the pension is paid every month for the rest of the pensioner’s life, the grant is only paid once.

The same criteria are applied to the survivor’s benefit, which is paid to the surviving spouse and children of a pension scheme member or pensioner who has died, or, where there are no surviving spouses or children, the contributor’s parents, if they were dependent on the contributor and registered with NSSA as dependants.

Where the deceased contributor had contributed for at least the minimum period required for a pension, then a survivor’s pension is paid. If contributions had been made for less than that period, then a lump sum grant is paid.

The invalidity benefit is payable to a contributor under the age of 60 who is medically certified as being permanently incapable of work due to a physical or mental illness or disability.

Apart from the grants that are paid in place of a pension where the contribution period is insufficient, there is also a funeral grant, which is paid to help towards the cost of the funeral of a deceased national pension scheme member or pensioner.

The funeral grant has been $300 since August 2013. Prior to that it was $200. It can be claimed by whoever is responsible for the funeral costs.

Pensions should be claimed within 12 months. Claims submitted later than that may still be accepted but will then only be payable from the date on which they are received by NSSA.

Up to five years is allowed for the submission of grant claims. No claims are accepted that are submitted later than that.

An exception to this rule was made last year, when for the whole of the year late retirement, invalidity or survivor’s grant claims were accepted.

As efforts by NSSA to create greater awareness among its members about the benefits of the national pension scheme bore fruit, an increasing number of enquiries were received from people who now realised that they might have been entitled to a grant a long time back.

NSSA therefore took steps to allow those who had failed to apply for retirement, invalidity or survivor’s grants within the maximum five-year period to submit or re-submit their grant claims during the course of 2014.

To make this possible required a statutory instrument gazetted by the Public Service, Labour and Social Welfare Minister suspending for the duration of 2014 the regulatory requirement for retirement, invalidity and survivor’s grant claims to be submitted within five years.

However, the 12 months allowed for this has now expired, so as from the beginning of this year the five-year limit for claims is once more effective and will be strictly adhered to. Five years is quite a long period within which to lodge a claim.

It is wise to lodge a claim soon after a person becomes eligible for a benefit. In the case of a retirement benefit that is soon after a contributor to the pension scheme retires after turning 60 or, 55 for those who retire early after having been engaged in an arduous occupation, or 65 for those still in employment at that age.

Categories of arduous work that allow the claiming of retirement benefits at the early retirement age of 55 include agricultural work, heavy truck driving, quarrying and some mining and forestry occupations.

To qualify, however, the person must be retired and must have worked in an arduous occupation for at least seven of the 10 years before turning 55.

In the case of the survivor’s benefit, it is wise to lodge the claim reasonably soon after the contributor’s or pensioner’s death.

Talking Social Security is published weekly by the National Social Security Authority as a public service. There is also a weekly radio programme on social security, PaMheponeNssaEmoyeni le NSSA, at 6.50 pm every Thursday on Radio Zimbabwe and Friday on National FM. Readers can e-mail issues they would like dealt with in this column to mail@mhpr.co.zw or text them to 0772-307913. Those with individual queries should contact their local NSSA office or telephone NSSA on (04) 7065235, 7065459, or 7990301.

Source : The Herald