Goodall admits pension discrepancies

Malawi Minister of Finance, Economic Planning and Development Goodall Gondwe has said pension discrepancies between civil servants who retired before 2009 will linger on until government starts implementing a national pension scheme.
Gondwe said this in response to a supplementary question from member of Parliament (MP) for Lilongwe Msozi South Vitus Dzoole Mwale (Malawi Congress Party -MCP), who asked if the minister was aware that civil servants who retired before the new pension formula came into effect were barely surviving on meagre monthly pensions compared to their post-2009 counterparts.
Gondwe said government had noted the challenge although it could not be corrected immediately.

Said the minister: “Two pensioners could have retired at similar grade, but the one who retired after 2009 gets twice as much. We may not reach the level that we would want them all to be, but we will try as much as possible that this should not happen again.”
One way to harmonise pension benefits, according to Gondwe, was to apply the average increase of pension contribution each time there was a salary increment in the civil service.
He said: “However, some pensions are very small that even if we were to augment them, the change would not be significant.”
The minister also disclosed that government was until June 30 implementing a programme to offset pension arrears owed to civil servants prior to the 2009 change in pension formula.
In the 2014/15 National Budget, Gondwe allocated K50 billion (US$111 million) towards payment of arrears to private sector, civil servants and pensioners.
He asked MPs to let his office know of any lingering arrears to be paid off so Treasury corrects before June 30, 2015.