Employers Reminded of Pension Fund Duty

FINANCE Minister, Ms Saada Mkuya Salum, yesterday warned employers in the public and private sectors against non-submission of employees’ pension contributions, saying the defaulters were risking the wrath of the law. “Employers should know that delayed or non-submission of the employees’ (pension) contributions is against the law,” said the minister in Dar es Salaam at the launch of the newly-appointed PPF Pensions Fund’s board of trustees, charging, “We will be very tough against the non-payers ... if the money is deducted (from employees’ salaries) why shouldn’t it be submitted?” Ms Salum, who also launched the Wote Scheme and Maternity Benefit, commended the pension fund for its exemplary performance and innovation in serving the public. Under the Maternity Benefit, all PPF members will be receiving a flat rate cash of 1m/- for four deliveries, spaced at three-year intervals. Through the Wote Scheme, a supplementary pension system, the pension fund seeks to accommodate all Tanzanians, irrespective of their economic activities, as long as they can contribute at least 20,000/-, monthly. PPF Board Chairman Ramadhan Kijjah, speaking at the event, said the fund’s worthness has grown from 859bn/- in September 2011 to over 2trn/- by June, this year. He said the fund has been reaping handsome earning from its investments, with the return on investments ranging between 22 and 26 per cent. “This (high return on investments) implies that the fund has been pursuing investments with high productivity,” he said. Mr Kijjah said the fund has always been considerate to the welfare of its members, citing the education benefit for the deceased members’ children as the most successful. The fund has a policy of educating the children of the deceased members from nursery to advanced level education. According to Mr Kijjah, the fund has this year spent 958m/- on education of 1,328 children of deceased members. The chairman, however, decried the withdrawal benefit, delayed submission of employees’ contributions by employers and huge debts as the key challenges that face the social funds in the country. “The withdrawal benefit is a serious problem because it goes against the essence of having the pension funds in the first place ... we have people with working ability who withdraw their savings for spending today, where would they go when they will stop working,” charged the chairman. Responding, Ms Mkuya said the government was determined to repay all its debts to the pension funds, noting that the non-cash bond will soon be introduced for the funds to recover their loans to the government. She said the government took the money and spent it towards developing the country’s infrastructure like roads, bridges and universities but, “That money must be returned because it belongs to members.” Source: daily news