Home » Legal and Judicial Affairs » IPEC Reviews Annual Commutation

Pensioners who retired after April 1 this year, and are supposed to receive a maximum annual pension of $30 a month or $360 per annum, now have the option to fully commutate their pensions. This means that these pensioners can choose either to continue receiving the $30 a month or $360 a year or opt to be paid their entire pension.

This followed an upward review of the figure, which is the minimum that can be paid out to pensioners, from $10 or $120 a year to $30 or $360 per year. According to circular number 2 of 2014 issued by the Insurance and Pensions Commission last week the review was effected through Statutory Instrument 61 of 2014 that was published in the Government Gazette of April 4, 2014.

“Subsequent to discussions with various industry associations, the Insurance and Pension Commission has through Statutory Instrument 61 of 2014 reviewed the annual allowable commutation as follows: maximum annual pension allowable amounting to $360 only per annum.

“This means that $30 and below payable to a pensioner per month can now be commutable as per the wish of the member,” IPEC said.

In addition, IPEC said the maximum preserved employer portion which can be commuted in full has also been raised to $300 and can also be commuted as per the wish of the member.

“Circular Number 2 of 2014 supersedes Circular Number 6 of 2009 dated August 5, 2009 where the amounts involved were $10 maximum commutable amounts per month and $250 preserved employer’s portions,” IPEC said.

Many pensioners have been crying foul over the low payouts that they have been receiving every month with some arguing that it is not sufficient to cover their transport costs whenever they travel to collect the money.

Most of the pensioners retire to their rural homes which makes it expensive to travel to and from the city to collect their pension.

Most pensions were eroded when the country adopted the multi-currency system and pension funds used different exchange rates to convert from Zimbabwe dollar to United States dollars.

Source : The Herald

Archives