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SENATE HANSARD 12 JUNE 2024 VOL 33 NO 57
PARLIAMENT OF ZIMBABWE
Wednesday, 12th June, 2024
The Senate met at Half-past Two o`clock p.m.
PRAYERS
(THE HON. DEPUTY PRESIDENT OF SENATE in the Chair)
MOTION
BUSINESS OF THE HOUSE
HON. SEN. GOTORA: I move that Orders of the Day, Numbers 1 and 2 be stood over until the rest of the Orders of the Day on today’s Order Paper have been disposed of.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
MOTION
REPORT OF THE JUDICIAL SERVICES COMMISSION FOR THE YEAR 2023
Third Order read: Adjourned debate on motion on the Report of the Judicial Service Commission for the year 2023 presented to this House of Parliament in terms of Section 323 (1) of the Constitution of Zimbabwe.
Question again proposed.
HON. SEN. GOTORA: I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
REPORT OF THE ZIMBABWE ELECTORAL COMMISSION FOR THE YEAR 2023
Fourth Order read: Adjourned debate on motion on the Report of the Zimbabwe Electoral Commission for the year 2023 presented to this House of Parliament in terms of Section 323 (1) of the Constitution of Zimbabwe.
Question again proposed.
HON. SEN. GOTORA: I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
REPORT OF THE ZIMBABWE HUMAN RIGHTS COMMISSION FOR THE YEAR 2023
Fifth Order read: Adjourned debate on motion on the Report of the Zimbabwe Human Rights Commission for the year 2023 presented to this House of Parliament in terms of Section 323 (1) of the Constitution of Zimbabwe.
Question again proposed.
HON. SEN. GOTORA: Thank you Mr. President, I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
BUSINESS OF THE HOUSE
HON. SEN. GOTORA: Thank you Mr. President. I move that Order of the Day, Number 6 be stood over until the rest of the Orders of the Day have been disposed of.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
MOTION
COMPENSATION TO PENSIONERS AND POLICY HOLDERS BY PENSION AND INSURANCE COMPANIES
HON. SEN. ZVIDZAI: Thank you Mr. President. I move the motion standing in my name, that this House-
AWARE that the hyperinflation of the period 2006 to 2009 reduced the value of the Zimbabwean Dollar and resulted in the demonetisation of the local currency in favour the United States Dollar;
SADDENED that insurance companies and pension schemes eradicated the value of existing insurance policies and pension benefits despite the fact that the hyperinflation alone could not wipe out the value of pension and insurance policies as some were invested in real estate and other schemes protected from currency volatility;
ACKNOWLEDGING that Government endeavoured to redress injustices related to losses incurred by pension and insurance policy holders by requesting pension schemes and insurance companies to compensate the victims;
NOTING that the Ministry of Finance, Economic Development and Investment Promotion committed itself to ensuring that victims would be compensated with effect from March 2024.
NOW THEREFORE, resolves that-
- a) The Minister of Finance, Economic Development and Investment Promotion apprises Parliament on the compensation of the aforesaid victims;
- b) The victims be compensated in United States Dollar to mitigate losses incurred; c) The Ministry of Finance, Economic Development and Investment Promotion strictly monitors pension and insurance companies to ensure that they do not short change pensioners and policy holders.
HON. SEN. PHULU: I second.
HON. SEN. ZVIDZAI: Thank you Mr. President. Thank you for keeping on bearing with us with respect to issues of procedure. I rise to speak on issues of loss of value of pensions and policies and other instruments that people of Zimbabwe participated in, hoping that they were investing into their future. The hyper-inflation set in 2006 up to 2009 when eventually Government decided that our local currency as ZWL had given up its breath, meaning that it had died, and it was to be replaced by the USD; at that stage, I remember very well that the Central Bank of Zimbabwe had just issued ZWL100 trillion notes and it meant that our currency had lost meaning and we had to move to rescue the economy and the people of Zimbabwe. Regrettably, whatever good, there is, sometimes it will solve one problem and give birth to another. In killing our local currency and moving over to the USD, the people of Zimbabwe who had invested in insurance policies and some who participated in providence funds as well as Government managed pension schemes such as NSSA and other Government pension schemes also lost a lot of value in the process.
The switchover to the USD meant that the insurance companies had some method to convert the value of these pension schemes from ZWL to the USD. The formula that was used to do the conversion was never through a consultative process. The people were not involved and noted that there was a serious erosion of their hard-earned investment. They lost a lot of value of their pension schemes. I remember at the stage of demutualisation, some people who had hoped to get some millions and millions of ZWL ended up getting something like 5USD, which indeed was very sad.
Happily, in 2015, President Robert Gabriel Mugabe instituted a Commission of Inquiry into the conversion and the loss of value of pension schemes. This Commission was headed by Justice George Smith with a few other people who were experienced in the insurance industry. I know one George Shinya who was a specialist in issues of insurance. I had an opportunity when I started my career to teach with him. He was a great statistician and then he moved over to Old Mutual.
Moreover, he had a very big understanding of the dynamics and mechanics of what was happening in the agent industry and was part of that Commission. The mandate of the Commission was to establish the total value and nature and the type of assets owned by insurance companies and pension funds as at 2006 or 2009. The mandate was also to determine the causes of loss of value of insurance policies and pension schemes that were managed by our insurance industry, the set of companies in the insurance industry.
Furthermore, to assess the conversion methods, I think this is where the challenge was. Cleverly, the President wanted to know the method that was used to convert the ZWL to USD value at dollarisation. He also wanted to know the level of prejudice that people suffered, the people who had the insurance policies and those that participated in providence funds that were governed by the Government.
The findings that Justice George Smith and his Commission established were that there were poor regulatory mechanisms by Insurance and Pensions Commissions (IPEC). IPEC is the Commission that deals with pensions and insurance. The regulatory mechanisms were very weak and this allowed the insurance companies to take advantage of that and allowed people to completely lose value of their investments.
So they determined that there was massive prejudice to pension and policy holders and that the remedy was to make sure that the victims were to be compensated. This is what the Commission established and recommended that there be compensation for the losses that were incurred from a formula that was not agreed on, a formula which was obviously very unfair. A formula that looked more on the interest of capital against the interest of the people. So we applaud Government for moving in that direction so that people could recover what value was lost. More particularly, Mr. President, the Commission actually established that there was capacity within the pension industry and the provident funds to compensate because most of the investments, we paid our monthly subscriptions to insurance companies and deductions were made by Central Government into our pension schemes. Fifty-four per cent of those funds were invested in property and other investments that hedge against inflation. So the argument that value was lost to inflation is not true, it is not honest because if you go round the nation, you will see beautiful investments, properties that Old Mutual for example, invested in. These are hedged against inflation, they did not suffer from inflation. Fifty-four percent of our investments over the years never lost to inflation, hence the pension schemes and the insurance companies have got capacity to compensate people and redress the suffering that people are experiencing at the moment.
Our pensioners, esteemed people who worked in the civil service, who worked in industry and contributed, are suffering today. They cannot even afford a square meal and yet they had invested so much into these schemes. Why is it necessary to compensate? The first thing is that it is necessary so that people can regain their value and that there is some sort of reparation. There is some sort of recovery on the people that invested hoping that their future would be financed this way.
The other important thing as well is to realise the importance of insurance and pensions schemes in establishing the economy, providing funding for the growth of the economy. Once compensation happens, we beg to rebuild confidence in the pensions industry. More people will then participate in the pension industry. They will participate in purchasing insurance policies. By doing that, we are actually saving so that part of the money can go into infrastructure development through prescribed assets, those funds being available to the people who might want to invest in manufacturing, value addition and so on.
Confidence in the insurance industry translates into a mechanism to help economic stabilisation and growth. It is also important to make sure that we cause this industry to live again and encourage people to save and avail funds for developmental purposes.
You know during times of difficulty, trying and prime times, the economy enjoys the capacity of people to keep spending on consumption. During trying times, insurance policies come in to ensure that people keep spending, thus helping stimulate the economy. It is important in those two respects and as a nation, we must understand that the cheating that happened impacted so heavily on the individual person as well as on the general economy and should not be accepted.
In 2023, that was around September, Government gazetted S.I. 162
which gave parameters on how the compensation should start and gave a
road-map to processes of compensation. In October/November, 2023 of
that year, all insurance policies and managers of provident funds would sit down and draw up a compensation plan. Thereafter, up to December, IPEC would look at all these plans and either pass them or fail them and for those that passed and generally, you were always supposed to pass because now the rules had been laid out and they were very reasonable rules. By December, clean shaven, we would have known that the process of compensation would start.
Happily, as we crafted our budget last year, the Minister of Finance clearly said by March, 2024, the process of compensating people would commence. We budgeted $174 million to begin that process. For Government to take the lead as the responsible authority for provident funds, NSSA and Government Pension Schemes, with an envelope of US$174 million, which is applauded as a very good intention but the devil lies in the detail and in implementation. Today we are nearly halfway through the year and there is dead silence with respect to that process. Where is Government with respect to this? Is this not being taken seriously enough? Are we convinced that if we injected the $174 million into the economy through compensating the people, that will be beneficial to the country?
Mr. President, this is where our prayer is. We pray that the Minister takes this seriously and at least update us as to where we are on the roadmap to compensating victims on the losses as excavated by the Commission that President R.G. Mugabe put together in 2015, and 2015 and 2024 is a good nine years apart. We want to begin to see some movement even if it is an indicator to just say look, ‘now the envelope has risen to $50 million, we are beginning this and that’. That will be pleasantly warm to us.
Some statistics indicate that the losses that pensioners and policy holders suffered amount to close to a billion dollars and there is capacity for insurance companies to make sure that the wrongs of the past are corrected for the benefit of the people of Zimbabwe at individual level and our economy at a more collective level. We also noticed that if we move with lethargy Mr. President, value is lost. This is why we pray that the compensation be hedged against inflation and the vagaries that affect our currency. In other words, I pray that compensation be in United States dollars because that currency is a little bit stubborn to the vagaries of the economy and other emerging challenges so that people can get value of their investments.
Once beaten twice shy, they say, would we like to let the insurance companies play the ball without close scrutiny? The answer is, they have beaten people and economy before. They need to be very closely supervised so that they compensate. No cent remains with capital but every cent goes to the appropriate people that invested in these banking schemes.
I so submit and I do hope that as the House, we take this matter seriously because it is a matter of very serious importance. I would also like to take this opportunity to thank you Mr. President for encouraging me to look deeper into the issue because at the initial stage, I would want to make it a one-minute statement. You encouraged me to make it a motion so that it can be debated more widely and for us to show our seriousness around the issue. I hope that my colleagues will support this motion because it is not only good for the people generally but also for Zimbabwe as a nation.
HON. SEN. MOYO: After ten years of hyperinflation which led to the dumping of the Zimbabwe dollar in 2009, the country took on a multi-currency system which resulted in a mismatch between pension fund assets and liabilities.
The multi-currency regime meant that there was no policy guideline for a suitable exchange rate to convert contributions and benefits to USD.
Most pension funds in Zimbabwe – the biggest problem we face is that contributions made by the children of Zimbabwe are being used to sustain the expensive lifestyles of senior executives without any return to the pension fund members.
Pension fund administrators are living large yet the people are living in serious poverty. This defeats the whole purpose of having this pension fund system.
The other problem is that most trustees on the boards who are elected from the plan membership do not have the necessary skills and it results in corruption taking centre stage. Most of these trustees are appointed due to favouritism and they have no knowledge of the pension business and do not have the right qualifications. The pension funds have no education and training policy to support the skills of the trustees. Therefore, they cannot fulfill the mandate of protecting and advancing the rights and interests of its members – the people of Zimbabwe.
The pension funds we have in the country have no strong information and technology systems such as internal audits, public accountants, procedure manuals and investment policy statements. Instead, they rely on manual records which result in millions of dollars in unclaimed benefits while the people of Zimbabwe suffer.
The Insurance and Pensions Commission should be empowered to prescribe acceptable price or cost ratios in order to improve the current situation so that investment returns can be enough to cover costs to prevent the draining of contributions. The IPEC Commission has to have qualified members who have to pass fitness and honesty tests on pension fund executive management. The bar has to be set high on the qualifications required for one to be a trustee. They should conduct a lot of training of trustees to ensure that they are confident in dealing with the more complex aspects of running the funds.
In closing, once qualified, the trustees chosen in confidence should be given powers to monitor and regulate whether the pension funds ICTs systems and processes are effective and acceptable. There must be severe punishment for non-compliance. I thank you.
*HON. SEN. KATUMBA: I would like to thank Hon. Sen Zvidzai for bringing up this important motion. If you look at most of us who are here, we are pensioners who did not get anything. In most cases, when you are saving money through the pension schemes especially through IPEC that represents insurance organisations for pensioners, you would be expecting to survive from that money. If you look at what happened in the past like what other Honourable Members are doing, indeed someone who has saved money and now due to retire, then inflation comes up and the currency changes. You are told that your money lost value. If only this issue about pensioners could be looked into and be rectified so that pensioners can be cushioned. You will be shocked when you go to IPEC and you are told that there are unclaimed pensions, yet there are a lot of people suffering in this country. This must be looked into, especially through the Commission that was alluded to, so that pensioners maybe assisted.
Most of the people who are going on retirement these days simply die soon after retirement because they will be going into deep trouble. I would like to encourage the Government to be seriously involved pertaining to pension issues so that people survive after retirement instead of availing the fund for beneficiaries.
THE HON. DEPUTY PRESIDENT OF SENATE: Thank you Hon. Senator Katumba.
*HON. SEN. MUPFUMIRA: Thank you for giving me this opportunity to debate on this motion. I would like to thank Hon. Senator Zvidzai for tabling this important motion.
Mr. President, some of us are now grown up. When we were still young and started working, pensions were there for civil servants like teachers, they had various names and schemes. People used to make pension contributions in preparation for retirement at the age of 60.
I would like to thank the Government for scrutinising this issue and acknowledging that we were robbed in broad daylight. This s not about Government, this money was looted by insurance companies. People contributed a lot of money for their future in order to avert suffering.
Indeed, we are told about inflation and all other stories, but the surprising thing is that most of these insurance companies are there. They bought a lot of assets, constructed malls and buildings and were pegging their assets against inflation. Some of us did not know what was happening and were told that there was no money after working and contributing for more than 30 to 40 years.
I am not talking about Government, but insurance companies. Some of them are main shareholders and have portfolios and assets outside this country. I thank the Government’s vision for highlighting this issue - indeed we need to look at it. In other countries that I cannot mention, people would have risen, brought up petitions and held mass action against these insurance companies. Locally, I think one person should just come up with that petition and then people should demand for accountability.
If you look at offices of those companies up to today, they are still taking our money yet they are not giving us anything. For some of us who can actually stand up against this, we are just a drop in an ocean. There are a lot of civil servants, teachers and nurses who invested their money yet they are not getting anything, they do not even know the offices to approach so that they can get an explanation of their life time contribution. Right now, we have moved to digitisation and electronic system, you give them your details, but you do not get anything. We hear about people who have not claimed their money, but they are not so many.
Government should come up with a Commission of inquiry. Government has also told us that there is some money budgeted, indeed it shows that Government understands that there is a problem. At the end of the day, we ask Government to look after people yet those people were contributing pensions. Those people who have reached 60 years used to be paid lump sums and get other earnings. Imagine someone as old as I am, being told that my husband has died and that I will only earn ZiG40.00 per month, yet my husband would have worked for 40 years or more. I am not the only one, some widows end up being desperate, yet there are assets and money that are there.
Let us take action because of that report. I expect action to be taken, there is no need for us to consider researches. A lot of people have died without earning those pensions and their surviving spouses and families are desperate. There is need for investigating as to who contributed during the yester years in order to ascertain how much their families are supposed to earn. Some families may not have that information, yet the late mother or father may have had money. A Commission was set up and research was conducted, all these reports are there. Now, we need action and clear explanation – there is need for openness so that media disseminates information advising beneficiaries that money is coming. There are a lot of affected people and the requisite media should be accessible to everyone including those residing deep in the rural areas.
Insurance requires surviving spouses to provide proof of life annually. I always say to myself, can an elderly woman in Kanyaga, deep in the rural areas where I come from do that? How does that person get that information? We are supposed to be all inclusive, they do not even know what is supposed to happen and how they should do it. Some people travel long distances to collect their pension, but the money that they earn cannot take them back to their homes. We need to look into such things so that people know and understand that we represent them when we come here.
These issues affect masses. People saved their money in an effort to plan for their retirement. I am saying that we should not just talk, but come up with strong resolutions that are binding. There is evidence and some of us are still alive. I do not know whether I will still be alive tomorrow. Some of our children may not even know that they were being deprived of their benefits for years, people would have been sending money overseas and the like. Those things have nothing to do with Government. Those are private companies. Sometimes we expect that Government should do everything yet here we are. You are trying to save your money to cater for yourself in future but here we are, there is no benefit from it.
So I would like to thank the Hon. Member who came up with this motion. There are a lot of malls that you find in cities and different towns. So how can they claim that they have lost value yet they are still in use? There is need for a thorough enquiry so that we at least get something.
Surviving widows may talk of their late husbands yet they are suffering. They are not getting anything. I would like to thank the Hon. Senator who brought this motion. It affects every one of us. Right now people no longer want to join pension schemes or insurance scheme because we lost a lot of money out of that. We used to contribute yet we never earned anything out of that. I thank you Hon. President for giving me this opportunity.
+HON. SEN. SIBANDA: Thank you President of the Senate. I would like to thank the Hon. Senator who brought this motion. I would want to add my voice to what has been said by the other Hon. Members in my short debate that I want to add which I believe could be of very much assistance.
If we look at the issue of pensions, it is something that is painful as others have already indicated earlier on. Looking at us as Zimbabweans and the way that we survive we are not people that are not developed. We are developed people and we are really educated which means that we are also supposed to be an example of doing the proper things.
Looking at most of the companies that are not Government institutions, they are better than Government institutions. To tell the truth this pension issue is very painful because as black people and as Zimbabweans, we appear as if we are enslaving ourselves. We are becoming slaves of our own because if the Government is the one that is responsible for employing much of the population and after the people have served a lot of years in the Government and people get peanuts after retiring, it makes it very difficult. Also people take their pensions before they are aged. Most of them have got families that they want to take care of, what we can refer to as extended family, that need to survive from this pension.
Looking at the way we are organised, it is very possible that we tell ourselves that we have failed to look into the issue of pensions and making them to be orderly or is it that we have just neglected and I will no longer mind about the pensions issue. We do not want to see Zimbabweans suffering due to these issues of pensions. Thank you.
HON. SEN. ZVIDZAI: I move that the debate do now adjourn.
HON. SEN. H. MOYO: I second Mr. President.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
REPORT OF THE 149TH ASSEMBLY OF THE INTER PARLIAMENTARY UNION (IPU)
Eighth Order read: Adjourned debate on motion on the Report of the 149th Assembly of the Inter Parliamentary Union (IPU) and related meetings.
Question again proposed.
HON. SEN. GOTORA: I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2023.
MOTION
CONGRATULATORY MESSAGE TO HON. SEN. CHARUMBIRA ON ASSUMPTION OF THE PRESIDENCY OF PAP
Ninth Order read: Adjourned debate on motion that a congratulatory message be conveyed to Hon. Senator Chief Charumbira on his ascendency to the President of the Pan African Parliament.
Question again proposed.
HON. SEN. CHINYANGA: Mr. President, thank you for granting me an opportunity to rise before this esteemed Assembly to convey my heartfelt congratulations to the Hon. Senator Chief Fortune Zephaniah Charumbira on his ascension to the prestigious office of the President of the Pan African Parliament (PAP).
This milestone achievement is not merely a personal triumph, but a resounding testament to the eminence and global standing of the Zimbabwean nation. As one of the senior statesmen and revered leaders hailing from our shores, Hon. Senator Chief Charumbira’s elevation to this continental leadership role underscores Zimbabwe’s unwavering commitment to the ideals of African unity, development, and democratic governance.
Mr. President, the Pan African Parliament as the legislative organ of the African Union represents the collective aspirations and voices of the diverse peoples of our continent. Under Senator Chief Charumbira’s discerning stewardship, we can be assured that this critical institution will amplify the concerns and priorities of Africans with renewed vigor and purpose.
Further, Senator Chief Charumbira’s wealth of experience and expertise honed through his distinguished career as a Senator in the Zimbabwean Parliament and his long-standing involvement in regional and continental organisations make him uniquely qualified to lead the PAP. His proven track record of public service, coupled with his deep understanding of African affairs, will undoubtedly propel the Parliament to new heights of influence and relevance.
Mr. President the election of Hon. Senator Chief Charumbira as the President of the Pan African Parliament represents a monumental achievement not only for the individual but for the nation of Zimbabwe as a whole. It is a testament to the vibrancy of our democratic institutions and the caliber of the statesmen we have produced.
This moment of pride and glory underscores Zimbabwe’s continued relevance and leadership within the African Union framework. As Hon. Senator Chief Charumbira assumes this esteemed position, he will have the opportunity to contribute decisively to the shaping of the continent’s political, economic and social trajectory. His stewardship will provide Zimbabwe with a valuable platform to champion its ideas, influence policy debate and drive the agenda of African integration and development.
Mr. President, as I conclude, I urge this august House to join me in extending our heartfelt congratulations to Hon. Senator Chief Fortune Zephaniah Charumbira on his election as the President of the Pan African Parliament. May his leadership inspire and empower the people of Africa to realise their collective aspirations for a more united, prosperous and democratic continent. I thank you Mr. President.
HON. SEN. GOTORA: I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
ESTABLISHMENT OF PUBLIC HEMODIALYSIS FACILITIES IN DISTRICTS
Tenth Order read: Adjourned debate on motion on the treatment of chronic kidney disease in Zimbabwe.
Question again proposed.
HON. SEN. ZVIDZAI: I move that the debate do now adjourn.
HON. SEN. PHULU: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
FINANCIAL ASSISTANCE TO ZUPCO AND PRIVATE TRANSPORT OPERATORS
Eleventh Order read: Adjourned debate on motion on the inadequacy of public transport in the country.
Question again proposed.
HON. SEN. GOTORA: I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
PSYCHOSOCIAL SUPPORT SERVICES FOR TEENAGE MOTHERS
Twelfth Order read: Adjourned debate on the motion on the effects of teenage pregnancy.
Question again proposed.
HON. SEN. GOTORA: I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
MOTION
REPORT OF THE DELEGATION TO THE 80TH SESSION OF THE EXECUTIVE COMMITTEE AND THE 45TH CONFERENCE OF APU HELD IN COTE D’IVOIRE
Thirteenth Order read: Adjourned debate on motion on the Report of the Delegation to the 80th Session of the Executive Committee and 45th Conference of the African Parliamentary Union (APU).
Question again proposed.
HON. SEN. GOTORA: I move that the debate do now adjourn.
HON. SEN. TSOMONDO: I second.
Motion put and agreed to.
Debate to resume: Thursday, 13th June, 2024.
On the motion of HON. SEN. GOTORA, seconded by HON. SEN. TSOMONDO the Senate adjourned at Eighteen Minutes to Four o’clock p.m.