Civil Servants under the Public Service Pensions in Sinazongwe District are appealing to the Government to consider amending the Pensions Act in order to provide for the partial withdrawal of their contributions.

Speaking in an interview with ZANIS, some civil servants expressed their concern that it was unfair for the Government to only consider public workers under the National Pension Scheme (NAPSA) leaving out those under the Public Service Pensions Fund (PSPF).

Joseph Hamoonga, a public worker under PSPF said the Government program of enabling those under NAPSA partially withdraw their contributions must be extended to under PSPF in order to help them also access the funds for their investment.

Mr. Hamoonga said those under PSPF were equally under the risk of not benefiting from their pension contributions because of bureaucracy in the process of accessing the retirement package whenever one was retired.

He said that others ended up dying without accessing their terminal benefits leaving their dependents stranded especially the children.

Magerate mwiinga another PSPF member expressed her concern that the Government must consider offering them an opportunity to partially withdraw their contributions.

“We are requesting the Government to ensure the Pensions Act are also amended and assented by the President to enable us access part of our contributions before we retire and die,” she said.

The Labour Movement in Sinazongwe District has also expressed similar concerns for its membership that is under the PSPF.

Zambia Union of Government and Allied Workers (UG)has also called on the Government to be considerate on the matter as it was affecting some sections of public workers particularly those under Pensions.

UG District Executive Committee Chairperson Stephen Phiri said a number of members that were under pensions were concerned and interested in also accessing their part of the contributions.

Mr. Phiri said it will be motivating enough to the public workers under pensions once the act is amended and passed by the President just like what was done to the NAPSA act.

However, workers under NAPSA started accessing their partial withdrawal after the amended act was signed by the President recently.

The process has elated many NAPSA members as they have been able to access their money while some have been complaining about the process as they are still finding it difficult to easily complete the process.

Authorities in Chifunabuli District in Luapula Province are concerned at the high numbers of Child Labour cases being reported in the District.

Chifunabuli District Labour Officer Moses Kazaka says it is sad that cases of child Labour have continued being recorded especially in the mining industry.

Speaking to ZANIS in interview in Chifunabuli today, Mr Kazaka revealed that with the coming in of mines in the district, Chifunabuli has recorded an increase in child labour cases resulting in them dropping out of school to go into mining.

“It is quiet saddening that as a district, we are facing a lot of cases of child labour especially were mines are concerned and most children are now being forced to drop out of school and are taken into mining at the expense of securing their future,” he revealed.

Mr. Kazaka revealed that children in the district are being subjected to the worst forms of child labour including sexual exploitation as a lot of girls are being subjected to early child marriages, teenage pregnancies and sexually transmitted infections.

“The situation is alarming, children in the district are being subjected to the worst forms of child labour including sexual exploitation as a lot of girls are being subjected to early child marriages, teenage pregnancies and sexually transmitted infections,” he explained.

He said while the Government is trying to curb the vice, parents on the other hand are not being cooperative as they are in the forefront of exploiting their own children.

“Government is trying to curb the vice but with the high poverty levels being faced in the district, parents themselves are not being cooperative as they are in the forefront of exploiting their own children with hopes of gaining a livelihood,” he said.

Mr. Kazaka explained that while parents go mining, they carry their children with them instead of going to school.

“Chifunabuli is the second poorest district in Zambia, and most families cannot afford to eat even two meals in a day, and while parents go mining, they carry their children with them and despite the introduction of free education by Government, some parents and children prefer to go mining to earn a living as they cannot even afford to buy school uniforms and books,” he said.

He observed that the Government still has a huge task to do in the district to help contain the situation.

Chifunabuli is among the districts in Luapula province with Manganese mines where children have continued to be used in mining.

Advocates for National Development and Democracy (ANDD) and the Zambia for Unity, Peace and Development (ZUPED) are expectant that the government will this week handover Konkola Copper Mines Plc back to its legal owners Vedanta Resources.

ANDD Executive Director Samuel Banda says Vedanta Resources has the technical and financial capacity to operate KCM.

“It is also clear that Vedanta Resources is actually the best suitable investor to operate KCM. We are so much expectant and our expectations are based on the fact that His Excellency President Hakainde Hichilema while on the Copperbelt on the 29th April, 2023 assured the people of Copperbelt that government will conclude matters regarding KCM and that government has found a solution to deal with challenges at KCM,” said Mr. Banda.

“And we must also state here that even the Minister of Mines and Minerals Development Hon Paul Kabuswe whilst on the Copperbelt announced that government has found a solution and that within this month of May, we will be able to make a decision.”

He said his organization does not know which investor government will engage but its position is that government should handover KCM to Vedanta Resources.

And ZUPED President Ronnie Jere said Government should also take advantage of the proposed investment package by Vedanta Resources which is US$3 billion investment capitalisation package and the US$20 million corporate social responsibility.

Mr. Jere believed that with that package they will be able to revamp KCM and and the economy.

“This will no doubt help in the creation of employment for our people as well as increase business opportunities on the Copperbelt. We know for sure that when KCM begin to operate optimally, we will be able to export copper in huge quantities which will help us earn more forex and we know that that will help improve the value of our currency Kwacha. This means that when kwacha improves, it means that the cost of doing business will reduce, the cost of importing products will also reduce. This will in turn give capacity to the private sector to expand and create employment and business opportunities which will result in improving the living standards of our people,” said the ZUPED President.

“Our point is that government should honor their assurance. President Hakainde Hichilema particularly should honor his assurance to the people of Copperbelt that he will conclude KCM matters. As a matter of urgency, we want government to conclude the issues regarding KCM and Vedanta Resources in the interest of unlocking the mining sector and making it viable and more importantly create employment and business opportunities on the Copperbelt.”

He said apparently, the Copperbelt economy is not doing fine.

“Poverty levels have gone high, the cost of doing business has gone high; people are suffering. It is very important that government should stick to their assurance and we hope that government will honor their promise. As we conclude, we want to urge government to ensure that within this week they make a decision on this matter of KCM and Vendata Resources as well as issues surrounding Mopani Copper Mines,” he added.

“If the government wants not to loose relevance, they should stop postponing this announcement otherwise the people are loosing confidence.”

By Mwansa Chalwe Snr

The government’s core rationale for the 20% partial pension withdrawal is to encourage beneficiaries to invest part of their pension themselves, while still in employment. There is a general agreement among Pension Contributors that the NAPSA pension in its current form is not sufficient to sustain someone after retirement because they believe that the monthly payments are too small.
“We have signed into law, the National Pension Scheme Amendment Bill 2023.The new law will give citizens the opportunity to reinvest the funds into various ventures and assets of their choice. As a result, more jobs will be created, contributing to our economic development agenda”, President HH said when signing the bill, clearly spelling out the objective of the new law.

It is an open question whether the beneficiaries are well equipped with what is expected of them. This piece is meant to educate beneficiaries about the different types of investments available on the Zambian market, in order to help them make informed decisions. The article will try to walk them through the different investment options. It will avoid the technical investment jargon, to make it easy to understand.
First and foremost, it is important for beneficiaries to know the two golden rules of investment. The number one rule in investment planning is that, you need to diversify your investments. In simple terms, you should never put all your eggs in one basket. This is meant to reduce your risk of losses.

The number two rule is that, when you are making investment decisions, you should always consider the following variables: return or income you will earn (interest, rent, dividend, director’s remuneration or salary), risk (chance of losing money), liquidity (ease of conversion of investment into cash for use when required) and capital growth (increase in the value of the original money you invested).

In Zambia, we have the following seven main types of investments that Napsa 20% pension beneficiaries should consider: Bank Savings accounts; Government bonds and treasury bills; Shares, Unit trusts; Real estate; Insurance policies and Starting own business.

Bank Savings and Fixed deposits accounts

Bank Savings and fixed deposits are among the safest investment options available to NAPSA beneficiaries in terms protecting your original investment amount and offering high level of liquidity. However, in Zambia, it is not advisable to invest the bulk of your pension money in a regular savings or fixed deposit account, because it will result in your money’s purchasing power declining over time due to inflation, and there will be no growth to your money. One of the objective of a rational investment strategy is to beat inflation. At the moment, Zambian inflation is at 10.2%, and Zambian banks are paying between 5% to 7% interest to savers. This means that a saver is earning negative interest between 3% to 5%.You are basically losing money. The Banks on the other hand, are using your money, and lending it to government and the public between 25% to 35%. The advice is do not keep too much of your pension money in your bank savings or fixed deposit, as it will be losing value. You should explore investment avenues that have the potential to fetch significantly higher returns and grow your capital.

Real estate Investment

Napsa beneficiaries have the option to invest in commercial or residential properties. But it is highly unlikely that the majority will receive funds sufficient to invest in the real estate market. Investment in real estate requires huge sums of money. There is, however, a possibility that one can acquire a piece of land. But the majority should consider investment options like bonds or shares, unit trusts etc as a starting point to build capital for investment in real estate in future, in say five or ten years’ time. There are reports of some beneficiaries getting amounts ranging from K30, 000 to K140, 000 which is good base.

Lusaka Stock Exchange Shares

The third investment option are stocks or shares or equities. In developed countries, investment by individuals in a stock exchange like Lusaka stock exchange, is among the most popular investment options because of the potential growth of shares. By purchasing a share, you become part-owner of publicly-traded companies like ZANACO, Airtel, Zambeef, First Quantum Minerals, Zambia Breweries, Shoprite Holdings and many others. Shares, like real estate, tend to increase in value over time. These investments are long term. This is a highly recommended investment option to all the demographics of NAPSA beneficiaries, as the amount of investment required to buy shares on the stock market is minimal.

Mutual Fund investment in Unit Trusts

The Zambian capital market has asset management companies. These are investment professionals who can invest your lump sum pension fund in a diversified portfolio of a unit trust of your choice, so that your money can grow. The Securities Exchange Commission (SEC) regulates the Zambian capital market including asset management companies. One can obtain a list of licenced asset management companies from the SEC website.

Government Securities (Bonds and Treasury bills)

The fifth investment option is to lend money to the government of Zambia. This is referred to as risk free because governments are not expected to default. And so it is smart for you to lend to the government as it is highly profitable. The last government auction was on 27th April, 2023. For the 5 year bond interest was 24% and the 10 year bond was paying 27.75% but bank fixed deposits were paying below 10%.

Insurance Policies
Insurance companies have a variety of financial products that Napsa beneficiaries should explore. Insurance products are developed to meet particular objectives and so it is worth enquiring from these companies on what they are offering and ensure you can choose products with growth potential.

Business start-ups

The last investment option is for beneficiaries to start their own business. This is the riskiest option in the absence of having acquired necessary management and entrepreneurship skills. Empowerment of people with financial capital without intellectual capital has, in the majority of cases, ended up in failure. There is overwhelming empirical evidence that 90% of micro and small businesses fail due to lack of basic management skills like financial management, marketing and business planning.
In a bid to help beneficiaries of NAPSA, and any other Zambians who want to start a business, I have designed a simple, practical and affordable mobile App, to teach them the basics about starting and running a small business. This is meant to bridge the knowledge gap. There is a lack of technology based intellectual capital in the market place. The App contains simple guidelines on the following: on how to prepare a start-up budget, simple one page business plan, one page marketing plan, interactive preparation of cash flow budget, basic small business management tools, and many more tips. This simple e-learning tool can reduce the risk of start-up business failure drastically. You can access it on Google Playstore: https://play.google.com/store/apps/details?id=com.yeca

Conclusion
It was not within the scope of this article to go into details about the investment options that I have described. I have highly summarised and simplified them for ease understanding. You will need to get further advice from experts, on how you could proceed with taking advantage of above lucrative investment options. The investment options in this article are not for any exclusive class of Zambians, but for all Zambians as long there are able to read and write. In developed countries, ordinary citizens in grow their wealth, and become financially secure through knowledge acquisition, and using professionals to help them. You just need to get a properly qualified financial advisor. You should, however, be careful, and be conscious of the many conmen in Zambia, who may pose as advisors so as to scam you.
It is hoped that this limited basic financial literacy lesson, as it relates to investment; will be helpful to NAPSA beneficiaries. It is advisable that you print the article for reference purposes. The partial Pension pay-out is meant to provide you with future financial security, and therefore, it should not be wasted or gambled. It is prudent that you do not consume it all. Invest the largest percentage of it in medium to long term investments for wealth accumulation and income generation.

The writer is a Chartered Accountant and Author. He is a semi-retired international MSMEs Consultant. He is also an Op-Ed Contributor to the Hong Kong based, Alibaba owned South China Morning Post (SCMP).Contact:[email protected]

The recent resignation of ZCCM-IH’s Board Chairperson, Dolika Banda, has caused deep concern among minority shareholders of the company. Banda, a highly respected business executive, had played a key role in leading ZCCM-IH and defending the country’s mining interests. Her departure has raised questions about the reasons behind her resignation and has led to speculation about excessive political interference.

In a statement issued on behalf of minority shareholders of ZCCM-IH, Thierry Charles, the spokesperson, expressed disappointment and concern about Banda’s resignation. He acknowledged her professionalism and competence and thanked her for her leadership and contribution to the company. Charles also expressed concern about the ongoing dossiers regarding KCM and Mopani and called for the safeguarding of ZCCM-IH’s interests.

The situation has been further complicated by the suspension of ZCCM-IH shares trading on the London Stock Exchange, following investigations into recent irregular transactions. This is the first time since 1964 that ZCCM-IH shares have been suspended on the prestigious stock exchange.

The Minister of Finance and National Planning, Dr. Situmbeko Musokotwane, has announced the appointment of Kakenenwa Muyanga as Dolika Banda’s replacement. The new Board Chairperson will face significant challenges, including ongoing negotiations with investors such as Vedanta Resources and First Quantum Minerals.

The minority shareholders of ZCCM-IH have expressed their commitment to remaining vigilant and ensuring that the company’s interests are safeguarded. The departure of Banda and the suspension of share trading have raised serious questions about the future of ZCCM-IH and the country’s mining interests. It remains to be seen how the situation will be resolved and what impact it will have on the company and its shareholders.