President Michael Sata this week directed Justice Minister Sebastian Zulu to amend the Pensions Act to allow civil servants retire at the age of 65 and not 55 years. This will require a parliamentary majority to become law. The age of pension provides the minimum retirement age and will apply to the private and public sector in line with existing legislation. The President believes the current limit is unnecessary punitive on those who have the strength to work longer. He also believes that higher age would make the pension system more sustainable in the long term. More people working may means less pay-outs, and more worthy pension arrangements (if reforms include this component).
To delve deeper into this issue, we asked our readers via our Facebook page and website, whether the President is right to propose an increase in the pensionable age. The following is the sample of the most interesting “properly identified” responses:
Personally I don’t approve of it, you know it’s not like we have a shortage of skilled labour. The many thousands graduating from several institutions where are they going to go? No where! Reasons being: (1) Government is the biggest employer and if it will hold on to these old folks who have done their worthy part by the time they are 55; and, (2) If Government keeps people until they are 65, when are these people going to learn about entrepreneurship and employ the energetic, skilled and employment hungry youths? I don’t think that’s the best way to build an economy. It’s not the best time to introduce such laws.
- Luckson Philip Chisi
This topic requires expert advice from demographers among others. From my little understanding, Zambia has more young people than adults. Blatantly it means that in the next 10 years Zambia will not have people retiring (not including those on contract and are over 55 years). In short people will start retiring 10 years from now. What do this mean? It means that a big number of young people have to sacrifice for at least 10 years! After 10 years we will get back to normal circle of people retiring every year. For some of us who are almost getting to 55 years and are not yet ready to retire it sounds a very good idea but for the young graduate with no job at all it may sound a death sentence! This policy unfortunately still needs a lot of debate, and finally consensus. Lets us not rush. We need to weigh both the positives and negatives.
- Brown Ngenda
I agree with Brown Ngenda, in as much as advice from demographers is a must, the concept should be the dynamics of job creation not Job retention-in light of the high level of unemployment! Mindful of the short life expectancy in Zambia, Government should keep the current 55yrs retirement age. Those retired would have left vacancies for new graduates. And as for the retired oldies, Government should have a robust programme to transform these retires with their "vast experiences" into business entrepreneurs creating jobs for the skilled and semi-skilled youths with the help of govt grants and their own retirement packages as liquidity. The spiral effect of this Concept on the economy cannot be over emphasised both in the short and Long term if Zambia is aiming for a middle income by 2030.
Govt should learn from the sale of houses by Chiluba to the old sitting tenants, who have congested the towns instead of going" (back to the Land concept-more bumper harvest)" now there’s no accommodation in towns for new graduates, creating an unnecessary demand for houses, compounded with other variables thus the high rentals in urban areas. Also, Policy should never be formulated to save a limited number of individuals in mind (the Chief Justice, Army Generals etc) but must be an aggregate tool in solving the many challenges facing the country as a whole and moving it forward progressively with the 7th generation in mind. Why can't Government formulate a concept of building retired personnel into chief executives and chairpersons of their own businesses as truly empowered citizens than locking talent and they would be entrepreneurs" into perpetual civil servants/employees for life? The employment concept should be reformed to be the means to the end (business formation or entrepreneurship) and not the end in itself.....
- Marco' Sovic'
The answer especially to Civil Servants is that its should be optional to choose when they reach 55 whether to continue or not. It should not be mandatory. So that those who get their masters and PHD in late 40's can contribute. It will also be pathetic to teachers where someone becomes the headteacher/principle in his/her 40's and you don't expect any promotion for the next let say 15 long Years. Let it be discriminatory only those with masters or PHD can be in government to serve for the next 10 years after 55...lol It has both good and bad notions. Imagine an old teacher who cant even walk properly at 60 years waiting for five more years affecting pupils attention thereby feeling petty for such workers to retire. Imagine a 62 years old nurse with poor sight looking for your vain to test you for VCT. Please let it be optional for people when they reach 55 period to give chances for those who want to rest and start their own empires...
- Daniel Daka
If this is done it must be phased in gradually not abruptly. The benefits would be fewer pensions to pay out and a more experienced work force. The costs would be fewer employment opportunities for the newly qualified youth and fewer new businesses starting up (retirees at 55years all go into business or farming if they get their benefits) An alternative might be to make the age optional within a range with a sliding pension scale; the longer you wait before retiring, the higher the pension. An immediate boost to the economy could be achieved by paying out all benefits due. It all gets invested in business. Some of the best emergent farmers I have met recently are retired teachers.
- R. Henson
No, not in favour for the following reasons:1. This move has the potential to restrict new entrants into the jobs market;2. Older employees are more expensive than new ones i.e., they most probably are at the top of their income brackets and over the years have undoubtedly received progressive salary increments. Therefore, this move runs counter to the promise to cut government expenditure;3. There isn't enough information on the productivity of older employee, so at this stage it's impossible match up the perceived benefits of experience versus productivity;4. The reasons advances for this push are unconvincing. Perhaps the rationale should be posited better?
- Ntheye Lungu