MPs call for improved retirement benefits formula
DODOMA: SOME Members of Parliament who debated the 2024/25 budget estimates for the Prime Minister’s Office have requested the government to re-think on how best to improve the formula for calculating retirement benefits for public servants.
The lawmakers insisted that under the new arrangements, there was still public outcry from retirees.
Under the current Social Security Benefit Schemes Regulations which came into effect on July 1st, 2022, workers are now being paid 37 per cent of their total savings in lump sum upon retiring, with the remaining 67 being reserved for the monthly pension.
However, public servants have on different occasions asked for 50 per cent of the lumpsum package.
Yesterday, when debating the budget estimates for the PMO which is responsible for payment of retirement packages through the Ministry responsible for Labour, Youth, Employment and Persons with Disability, the lawmakers were bitter at the current pension scheme, calling for the review of the regulations for the best interests of the retirees.
“This money is just nothing but savings made by employees, therefore, by giving them a mere 37 per cent, still I have been receiving complaints from former employees and I have even text messages on my phone sent by some of them arguing that the money is not enough to cater for their lives,’’ noted Special Seats MP, Ester Bulaya (CHADEMA).
The legislator also urged the government to repay the loans it owes the Public Service Social Security Fund (PSSF), saying the fund was not liquid enough to clear pensions for retirees from the public service.
Sumve lawmaker, Kasalali Mageni (CCM), argued that it was time the government considered retirees as persons who by themselves manage their retirement payments because they have served the government for years handling individual budgets and those of various projects.
“To me, this is not fair to public servants. How come the government claims that retired public servants can’t manage their own money while they safeguard public funds during their days of service,” said Mr Mageni.
Special Seats MP, Janejerry James (CCM) said that payments for retired public servants from the education sector, especially teachers should be a priority to motivate teachers in school to observe their responsibilities with efficiency.
Moving his budget estimates for his ministry on Wednesday, Prime Minister Kassim Majaliwa asked MPs to approve 350.99bn/- for his office and other institutions under his docket as well as 181.8bn/- for the Parliament.
The Prime Minister said out of the proposed budget, about 146.4bn/- is for recurrent spending and the remaining 204.6 bn/- is for development expenditure.
Regarding the retirees, Mr Majaliwa told MPs that between July 2023 and February 2024, PSSSF had provided a golden handshake to about 29,806 retired workers, dependants and other eligible beneficiaries amounting to 927.17bn/-.
On the monthly pension, the premier said the government had equally paid monthly pension to about 168,072 retirees on an average of 70.08bn/- per month.
“Also, during a similar period, the National Social Security Fund (NSSF) cleared retirement packages amounting to 577.7bn/- to 89,795 retirees, dependants and other beneficiaries, whereas out of that amount, 79.8bn/- were paid as monthly pension to 30,756 persons which is an average of 9.98bn/- every month,’’ noted the Prime Minister.
Mr Majaliwa further told the House that the Workers Compensation Fund (WCF) had during the same period paid 12.1bn/- in compensation to beneficiaries of the fund.
Although some MPs charged that PSSSF was in dire financial constraints, the Prime Minister said Wednesday that between July 2023 and February 2024, the pension fund had collected 906.46bn/- (equivalent to 53.91 per cent) against the annual target of collecting 1.7tri/-.
