Saturday, June 15, 2024

Its only a proposal, ZFE clarifies NAPSA hike leak


NAPSA headquatres

Zambia Federation of Employers has clarified that the matter to double NAPSA contributions was a proposal debated during the Tripartite Consultative Labour Council meeting held last month.

ZFE Executive Director Harrington Chibanda explained that letter circulating which leaked on the proposals was addressed to ZFE members inviting them to a consultative meeting on the matter and wondered how it leaked on social media.

Mr. Chibanda has however stated that there was no resolution during the meeting to increase pension contributions and abolishment of private pension schemes.

He said the proposal was brought to the TCLC by the Ministry of Labour and Social Security during last month’s meeting.

“I suspect one of my members who has been invited to this meeting leaked the letter to the media. What is true is that the matter is only a proposal for one and there has not been a resolution made yet,” Mr Chibanda said.

He added, “I was called by the Ministry of Labour and they asked me how the letter leaked to the media and I told them that it could be one of our members who was invited to the consultative meeting who leaked the letter.”

The Ministry of Labour and Social Security yesterday dispelled reports that Government intends to hike NAPSA contributions from 5 to 10 percent employee and employer contributions respectively and abolish private pension schemes.

In a statement, the Ministry of Labour and Social Security dispelled the reports alleging that government intends to hike NAPSA employee contributions from five to 10 per cent and abolish the private pension scheme.

The Ministry’s Permanent Secretary Barnaby Mulenga said contrary to the reports, there has not been any such proposals by government with regard to NAPSA contribution rate.

He stated that procedure for adjusting the contribution rate could only be done after passing the law, determining the benefits package and undertaking actuarial evaluation which should inform such an adjustment either upwards or downwards “of which this process has not yet been done”.

Mr. Mulenga stated further stated that there had not been any proposals to abolish private pension schemes as alleged by media reports.
He stated that government was consulting with various stakeholders on pension reforms and the outcome of such a procedure would be availed to the public .

Mulenga further clarified that the said consultations were “not even about hiking contribution rates for NAPSA or to abolish private or occupational pension schemes”.

According to a proposal from the Ministry of Labour and Social Security, NAPSA monthly contributions will rise to 10% employer and 10% employee.

The proposal also seeks to limit the pension schemes allowed to exist in Zambia to have just one, NAPSA.

The proposals are part of government plans to reform the pension sector which government said have reached an advanced stage.

Details of these reforms were shared at a recent Tripartite Consultative Labour Council meeting in Lusaka.

The government also wants to collapse the Public Service Pensions Fund and the Local Authority Superannuation Fund and have only NAPSA existing.

In a letter addressed to its members inviting them for a consultative meeting and seen in Lusaka, Federation Executive Director Harrington Chibanda said the Federation will come up with a position paper after the consultative meeting.

“At the last Tripartite Consultative Labour Council held in June 2nd 2019, the government informed the Tripartite Partners that among the many proposals in the reforms is the collapsing of the Public Service Pensions Fund and the Local Authority Superannuation Fund and the proposal to increase pension contributions to the National Pensions Scheme Authority from the current 5% employer and employee contributions to 10% employer and 10% employee,” the letter read in part.

The proposal will be extended to the private sector to do away with private occupational pensions schemes and only contribute to NAPSA.

“The Federation would like to undertake consultations on the said matters in preparation for a position paper before the Minister of Labour and Social Security announces the next Tripartite Consultative Meeting. Consultative Meeting to be held on Friday, 26th July 2019 at Radisson Blu from 08:30 Hours,” it read.


  1. The proposal also seeks to limit the pension schemes allowed to exist in Zambia to have just one, NAPSA.

    Why limit the pension schemes to just one, I thought we were a free market?

    • In Zambia, proposals usually turn into law. We are then told to just accept because its been signed and its going nowhere.

  2. Even if it was just a proposal, it’s very worrying that ZFE would even think of such. And what benefit is there for employers to only be paying contributions to NAPSA? Why did they come up with this? Something is fishy here.

  3. Such proposals are repugnant to say the least.You should have proposals where Napsa should give out loans to its members. Not such puerile proposals. A 10% increment on employer and employee contributions respectively, will result in a lot of default rate. It will also increase a lot of penalty accumulation on the part of employers. Napsa,as at now, is owed a lot in terms of penalties. Most companies are in arrears which they are liquidating. A further increase on the contribution will result in catastrophic penalty accumulation. The other proposal of merger should not be entertained. LASF and Pensions Board are not health in terms of their Balance sheets. Why should Napsa take financial statements which are not healthy in its books?It does not make sense at all.

  4. These goons in government don’t think at all. They fail to pay retirees at the current contribution rates and now want to raise so that they may further fail to pay because it will be too much to pay again. A question i have is that being an accountant i know NAPSA contribution have a certain limit that one can contribute in terms of amount so if the calculation of the salary based on 5% exceeds that amount then that person only contributes the threshold amount so if NAPSA wanted more money why didn’t they just abolish the threshold amount. Companies will stop hiring out of fear of increasing labour expenses they incur by 5%. Already companies are chocked by the minimum 25% gratuity passed, how much more will they be able to take.

  5. Mr Director, “I told them that it could be one of our members who was invited to the consultative meeting who leaked the letter.” With this level of behaviour nothing will come from your team it will be yessssss through out the meeting. Ati ba Director

  6. Zambians should not continue tolerating these types of things. We’re tired of being robbed of our earnings through NAPSA and taxes. This proposal should not even be entertained.

  7. Donchi kubeba, no doubt, they have already decided no doubt. Next it has been signed into law, next day assented to, next day an SI. Government inciting riots? Never heard such a thing, but people sometimes dig their own graves.

  8. Kwena this gvt may it go down there’s nva smoke with out fire… Am sure some talk are on the way. U fools u think we work for you?? Selfish bloody *****s

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