Zimbabwe pension fund NSSA says company closures and retrenchments slow down 30pct in FY14

Zimbabwe pension fund NSSA says company closures and retrenchments slow down 30pct in FY14

HARARE, June 26 (The Source) – Zimbabwe’s public pension manager National Social Security Authority (NSSA) on Friday said the rate of company closures and retrenchments slowed by 30 percent in 2014 compared to the previous year, but warned that worsening economic conditions would hit its pension fund.

During the year, at least 52 companies retrenched, resulting in close to 7,000 employees losing their jobs compared to an estimated 75 companies that closed and retrenched 9,000 workers in 2013.

“The continued company closures impact negatively on the performance of the Authority and it is likely to affect pension benefits of employees,” general manager, James Matiza said in a statement accompanying NSSA’s financial results for the year on Friday.

Contributions to the National Pension Scheme (NPS) rose by 43 percent to $248,3 million in 2014 compared to $173,4 million in the previous year.

But premiums for its workers compensation insurance fund (WCIF) were down 21 percent to $48,7 million from $58,5 million in 2013.

Claims for NPS and WCIF were up 25 percent from $99,2 million in 2013 to $124,8 million in 2014.

“As the economic woes continue to worsen, we have seen a good number of employers downgrading from a rating of ‘voluntary contributors’ to the common pool of ‘need-follow-up-employers,” said Matiza.

Assets increased by 10 percent from $ 1,038 billion in 2013 to $1,137 billion in 2014.Opertaing expenses increased by 21 percent from $43,9 million to $95,2 million in the year under review as a result of allowances for credit losses of $43,4 million and debts written off amounting to $9,4 million.

Profit after tax during the year amounted to $98 million from $93 million the previous year.

NSSA said 98 fatalities and 5,491 serious injuries occurred during 2014 compared to 76 fatalities and 5,666 serious injuries recorded in 2013.

Capital Bank figures were not consolidated in the 2014 group financial statements as it was not operational.

NSSA holds an 84 percent stake in the collapsed bank after converting its $8, 5 million deposit into equity in 2012.