21 Aug 2022

Parliament on Wednesday passed the Retirement Funds Bill 2022 to the committee stage after MPs unanimously supported it.

The bill, which would replace the repealed Retirement Funds Act 2003, was tabled on a certificate of urgency by finance minister, Ms Peggy Serame on Monday.

Ms Serame said the bill was, amongst other things, providing for members to access their deferred pensions to repay defaulted mortgage loans for principal homes. She said the bill also provided for payment of medical expenses using deferred pensions in case of terminal ailments. It also increased the amount members could encash from one third to 50 per cent.

Selebi Phikwe East MP, Mr Kgoberego Nkawana supported the bill, saying it was proposing what people had been asking for. He said an increase in the encashment of deferred funds would enable Batswana to develop their lives using the retirement funds.

He further said government should make fund administrators invest pension monies locally instead of abroad.

He said investing pensions abroad was risky since some monies ended up being lost or untraceable.

“The money should be made available for development of infrastructure in our country and used as security for Batswana to build houses. Batswana want to buy property or start businesses that will help to grow the economy. However, this is not possible because of lack of money even though they have lots of pension monies,” said the MP.

Mr Nkawana said it was not good to hold onto people’s funds until they became too old and unable to invest their money or generate wealth.

Maun West MP, Mr Dumelang Saleshando also supported the bill. He, however, said it was risky to allow people to use their retirement funds before reaching old age. 

He added that it only served to reduce their future pension payments. He said an increment of salaries in government and the private sector would address the current plight facing the working class.

“The reason why workers are facing their current plight is because of the low wages economy in this country. When wages are low, workers are unable to make much savings, hence they want to be given their pensions,” said the MP.

He further asked the minister to review the rules governing pension funds to allow for housing finance.

While he supported the bill, Lerala/Maunatlala MP, Mr Sethabelo Modukanele said the objective of pensions should not be forgotten. 

He said pensions ensured that retirees continued to live with dignity.

Palapye MP, Mr Onneetse Ramogapi asked for the law to have a time-frame for processing of retirement funds after employees retired. He said there had been cases of pensioners taking up to four years without their pensions being processed. ENDS