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NATIONAL ASSEMBLY HANSARD 17 AUGUST 2021 VOL 47 NO 75
PARLIAMENT OF ZIMBABWE
Tuesday, 17th August, 2021.
The National Assembly met at a Quarter-past Two O’clock p.m.
(THE HON. SPEAKER in the Chair)
ANNOUNCEMENTS BY THE HON. SPEAKER
DEATH OF HON. ZENZO SIBANDA
THE HON. SPEAKER: It is with profound sorrow that I have to inform the House of the death of Hon. Zenzo Sibanda, Member of Parliament for Tsholotsho South, on Wednesday, 11 August, 2021. I therefore ask all Honourable Members to stand and observe a minute of silence in respect of the late Hon. Member.
All Hon. Members observed a minute of silence.
May his soul rest in eternal peace.
NON-ADVERSE CERTIFICATES RECEIVED FROM THE
PARLIAMENTARY LEGAL COMMITTEE
THE HON. SPEAKER: I wish to inform the House that I have received Non-Adverse Certificates from the Parliamentary Legal Committee on the following Bills:
- Police Amendment Bill[H. B. 2, 2021];
- Guardianship of Minors Amendment Bill [H. B. 7,
- Copper Control Amendment Bill [H. B. 3, 2021]
NON-ADVERSE CERTIFICATE FOR GAZETTED STATUTORY
THE HON. SPEAKER: I also have to inform the House that I have received Non-Adverse Certificates for the Statutory Instruments gazetted during the month of July, 2021.
PETITIONS RECEIVED FROM RUGARE WETLANDS
ASSOCIATION, HEADLANDS RESIDENT COMMITTEE, MR.
STEVEN MAZINEFU AND BERIAS BRIAN TRUST
THE HON. SPEAKER: I have to inform the House that on 19th July, 2021, a petition was received from Rugare Wetlands Association, beseeching Parliament to ensure that local authorities and relevant Government agencies properly manage the sewage system in Rugare and the surrounding suburbs.
Further to that, the petitioners requested Parliament to encourage National Railways of Zimbabwe, as the land owner in that area, to avail a lease agreement to Rugare Wetlands Association for the proper management of wetlands and public stands in Rugare. The petition has since been referred to the Portfolio Committee on Environment, Water, Tourism and Hospitality Industry.
I also have to inform the House that on 28th July, 2021, Parliament received a petition from Headlands Residents Committee, requesting Parliament to investigate cases of lack of transparency, abuse and misappropriation of residents’ funds by officials at the Headlands
Growth Point amid lack of service delivery by Makoni Rural District Council. The petition has been since referred to the Portfolio Committee on Local Government, Public Works, National Housing and Social
On 27th July, 2021, Parliament received a petition from Mr. Steven Mazinefu of 4611 Glen Norah A- Harare, requesting Parliament to comprehensively review Statutory Instrument Number 33 of 2019, Presidential Powers (Temporary Measures) on amendment of the Reserve Bank of Zimbabwe Act. The petition has been referred to the Portfolio Committee on Public Service, Labour and Social Welfare.
On 12th August, 2021, Parliament received another petition from Berias Brian Trust, requesting Parliament to investigate some alleged constitutional irregularities. The petition was deemed inadmissible as the petitioners did not comply with the rules of procedure on petitions.
They have since been informed accordingly.
HON. MISIHAIRABWI-MUSHONGA: Thank you very much
Mr. Speaker Sir. I stand on the basis of a motion of national importance. Mr. Speaker Sir, I think this country has faced, in the last two to three weeks, a very worrisome incident of the young girl who was pregnant and died at a shrine. I stand to raise this as a major concern, particularly in that the country still awaits a full statement of what actually happened in terms of this child and what Government intends to do on this particular aspect. For some of us that have been in women’s rights for a long time, we are particularly concerned that the issue of Marange and the abuse of children within that particular sect, has been on the table for more than two decades and it has been known that this is what is happening. It is worrisome that even today when something has happened so publicly, we have since not heard what is going to happen vis-a-vis the perpetrators.
I therefore would ask, through you Mr. Speaker Sir, that the Minister of Home Affairs comes to this House and gives a ministerial statement to explain what happened in terms of this child, and what is happening in terms of the abuse that we all know is happening within the
Marange sect so that we can at least understand and appreciate that Government is indeed doing something to protect our young girls. Thank you Mr. Speaker Sir.
THE HON. SPEAKER: The Hon. Minister of Justice, my sixth
sense tells me that something is being done by the Executive, can you intervene?
THE MINISTER OF JUSTICE, LEGAL AND
PARLIAMENTARY AFFAIRS (HON. ZIYAMBI): Thank you Mr.
Speaker Sir, for allowing me to respond on behalf of the Minister of Home Affairs. It is not as straightforward as Hon. Misihairabwi is trying to say. Indeed, Government is doing a lot. Investigations were started and it goes to the root of the culture of that particular community. Initially, there was total lack of cooperation from the whole community, to the extent that the police were not even told where the girl was buried. Investigations which include trying to engage the community are ongoing.
So it is not correct to say that Government has not been doing anything. It is something that goes deep into the cultureeligious practices of that community. The police are trying to get to the bottom of it, but they are faced with resistance from the whole community, and they are working on it. At this juncture, I think it is too early for the Minister to come with a ministerial statement because they are doing something. Once they have managed to get to the bottom of it, then he will be able to give a full and informed statement to the House. I thank you.
THE HON. SPEAKER: Thank you Hon. Minister for the
clarification. Hon. Misihairabwi, I am sure you take note that the investigations have started...
Hon. Dr. Labode having interjected while the Speaker was holding
THE HON. SPEAKER: Hon. Dr. Labode, you are a seasoned
politician, I do not expect interjection whilst I am speaking. Once the matter has been fully investigated, the statement will be given to this august House. There is no need for interjection because the process is on. Thank you.
(v)HON. G. DUBE: Thank you Mr. Speaker Sir. I stand on a matter of public importance and this issue is in relation to a Press Statement dated 7th of July, 2021 pertaining to the corruption in local authorities. The Minister of Local Government and Public Works appealed to all local authorities to exercise good corporate governance and ethical conduct by not reinstating individuals who are in the midst of ongoing investigations and criminal cases. I would like to refer to the current events sweeping through most of the local authorities where the Minister has been very actively involved, particularly in Victoria Falls where he has been involved in the day to day administration of this city.
Various media houses were awash with the suspension of Mr.
Ronny Dube on the abuse of office. The matter was heard at Hwange Regional Magistrate Court and he was granted bail. The conditions were to surrender his passport, reporting to ZRP, ZW15 000 bail and not to interfere with the officers at the municipality, but should report for duty. The Minister, in his wisdom on the 14th of May, 2021, chartered a private plane to Victoria Falls to verbally suspend the Town Clerk through a press statement - as I alluded to earlier on, issued by the
Permanent Secretary. What is of concern to the public is that the Hon. Minister did not write anything to the council but he merely issued a verbal instruction which was later followed up in written form by the Mayor. He further verbally advised the council that Mr. Ronny Dube must be excused from work with a basic salary fully paid until the matter is finalised.
The council set up an independent inquiry which cleared Mr. Ronny Dube of any wrong doing in this matter. The Mayor in turn communicated to Mr. Ronny Dube and referred to the Minister.
Mr. Speaker Sir, the public is so much concerned as this as a violation of contractual obligations and unwarranted interference by the Hon. Minister in the running of the City of Victoria Falls as the Minister had ceased to be. This thing is against the spirit of devolution Mr. Speaker Sir. Having brought this before the House and in view of what I have said above, I therefore appeal to the Minister of Local Government and Public Works to give a statement before this House to explain what is happening in Victoria Falls as this is a tourist area which is the future of the nation. We cannot allow a situation where a town like Victoria Falls is managed as it is now. Thank you.
THE HON. SPEAKER: We will advise the Hon. Minister to
make a statement regarding the administration of the Victoria Falls City accordingly.
RATIFICATION OF THE TREATY FOR THE
ESTABLISHMENT OF THE AFRICAN MEDICINES AGENCY
THE MINISTER OF JUSTICE, LEGAL AND
PARLIAMENTARY AFFAIRS (HON. ZIYAMBI): Mr. Speaker, I
move the motion standing in my name;
THAT WHEREAS Section 327 (2) (a) of the Constitution of Zimbabwe provides that any Convention, Treaty or Agreement acceded to, concluded or executed by or under the authority of the President with one or more foreign States of governments or international organisations shall be subject to approval by Parliament;
WHEREAS the Treaty for the Establishment of the African
Medicines Agency was adopted by the African Union on the 5th
WHEREAS the Republic of Zimbabwe is a signatory to the aforesaid Treaty;
WHEREAS the Republic of Zimbabwe is desirous of becoming a
Party to the aforesaid Treaty;
AND WHEREAS the entry into force of the aforesaid Treaty shall be conditional upon its ratification by Member States in accordance with their constitutional procedures;
NOW THEREFORE, in terms of Section 327 (2) (a) of the Constitution of Zimbabwe, this House resolves that the aforesaid Convention be and is hereby approved.
Mr. Speaker, we are desirous to do that and that is the reason why we are bringing these proceedings before the House to ensure that Parliament agrees to the ratification of the African Medicines Agency. I am hopeful that Hon. Members have been able to have sight of the treaty. It is a very good treaty that will help us as a continent to be able to promote our own traditional medical products, develop and use them.
Our view is that this is a very important treaty Mr. Speaker Sir, that as a Parliament, we must ratify so that we can deposit the instruments of ratification. The Hon. Minister of Health who is also our Vice President is also desirous that since this is a new treaty that came into force two years ago, as a country, we are in a good position to bid to host the African Agency. It will be in the best interest of Zimbabweif we can ratify it so that when we solicit for support, our papers will be in order.
So Mr. Speaker, having said that, I therefore move that the aforesaid Convention be and is hereby approved.
HON. DR. LABODE: Thank you very much. I rise to support the domestication of the proposal by the Minister of Justice. I fail to understand why it has taken us so long to make that decision because Zimbabwe can benefit from it. Obviously, we cannot isolate ourselves as if we are a big manufacturing company to be able to compete in the world, especially in African for exports of drugs. For bulk manufacturing, we would need to come together as a continent. Right now, the reason why we have such expensive drugs and why our small companies are failing to compete is because India produces in bulk for the UN, the whole world and when the product lands here, it is cheaper than the one produced here. So, I think NEPAD has come up with a
very good proposal, that let us come together and put our resources together and say for example Zimbabwe, go and produce ARVs, South Africa produce this and you produce that. Let us export to each other at controlled prices. This is good for Zimbabwe and Africa Thank you.
HON. NDUNA: Mr. Speaker Sir, I just want to add my voice to the ratification of the treaty. Having heard Hon. Dr. Labode speak to and about the domestification of the same, I am challenged to provoke some thinking of some thought process in terms of beneficiation of our God-given natural resources which we are endowed with.
Instead of exporting them raw, it is my thinking that His Excellency, the President Cde. E. D. Mnangagwa has already proclaimed that one percent of our national GDP goes towards research and development. It is my hope and view that we can include that money in terms of making sure we have a robust, resilient, effective and efficient beneficiation value adding chain of our natural medicines, instead of exporting that raw.
We have no greenhouses for these trees that we have and our natural medicines grow in the bush, as opposed to what happens in other countries like Europe and other entities.
Hon. Nduna signalling the Hon. Speaker.
THE HON. SPEAKER: What is your problem? Why are you
HON. NDUNA: I think the Hon. Member has got a challenge.
THE HON. SPEAKER: Hon?
HON. NDUNA: Hon. Misihairabwi-Mushonga has got a challenge. She is actually weeping uncontrollably Mr. Speaker Sir.
May you allow your officers to attend to her?
Hon. Mavetera walks out of the House with Hon. Misihairabwi-
HON. NDUNA: Having said that, it is my clarion call and fervent view that we can get more benefit from beneficiation of our natural medicines, as I have alluded to – that grow naturally within our midst.
In the same way, after domesticating this convention and treaty, we need to domesticate other treaties in the future, to make sure that we use our God given natural resources; minerals in particular so that one day we can use a gold coin, platinum dollar or diamond dollar as opposed to the United States dollar and all the papers because we are beneficiating and value adding our God-given ubiquitous amount of mineral wealth.
Having said that, I endorse the domestification of this treaty without any further ado. I thank you.
(v)HON. S. BANDA: I support the ratification of this critical issue because it is going to benefit Africans and it will ensure that we market our products to the whole world.
(v)HON. MUDARIKWA: I rise to support the ratification of the Convention of African Medicines. In the interest of African Unity and in the interest of developing what we inherited from our forefathers that we must develop medicines produced in Africa for Africans; the august House approved a Statutory Instrument which was produced by the
Ministry of Lands and Agriculture and the Ministry of Health and Child Welfare which had something to do with the production of marijuana for medicinal purposes.
Marijuana is an indigenous plant for indigenous people and it has got a lot of medicinal value. By approving this treaty, we must also take into account that as participants of the treaty; what is it that we are giving to Africa and what is it that we are developing for the interest of the development of medicines in Africa.
In many instances, African medicine has been looked down upon by many people, with the exception of a few ones that are common which are sold on the streets. Most of it is not available and there is no documentation which is critical for the development of anything. If there is no documentation of anything, that whole thing is lost. So I support and propose that this convention be ratified and all the Hon. Members in our constituencies need to get copies of this and then give this to our traditional healers so that they understand that they are part of this new Africa and new world where they must participate. I thank you Mr. Speaker for allowing me to participate infrom Uzumba Constituency.
(v)*HON. DUTIRO: Thank you Mr. Speaker for affording me this opportunity to debate on the issue of traditional medicines. Traditional medicines help people very much. Many people get help from traditional medicines. The traditional healers are always there at home helping people most of the time. Traditional healers help in treating fontanelle (nhova), helping mothers. This means that the job being done by these traditional healers is very crucial. Government must work or make sure that traditional healers are recognised. Recently, we had ZINATHA and this organisation was famous in helping people using traditional medicines. Nowadays, people who consult traditional healers do the consultation during the night. No one goes to traditional healers during the day because it is a practice which is being looked down upon nowadays. Those who grew up through practicing traditional healing methods are grown up people and these are old people. I suggest that the use of traditional medicine must be taught to our children so that our history and knowledge remains intact and can be passed from one generation to the other. Our kids must know what to do or what medicine to use when they experience stomach pains or have eye problems. This must be general knowledge rather than people travelling many kilometers going to the clinic whilst they have the medicines at home. If possible, traditional healing must be included in the school curriculum as a subject so that they know the medicines which are available at their disposal. It also saves a lot of money rather than using traditional medicines from other countries like India and China, yet we have our own medicines in the country. Government must work and make sure that traditional healers operate openly and stigmatisation associated with their line of work is removed. Thank you Mr. Speaker.
(v)HON. MUNETSI: Thank you Mr. Speaker for according me this opportunity to add my voice in support of the ratification of the African medicines. In our daily living, you will discover so many Africans suffer side effects because they have not taken medicine that comes from our natural resources. I support that this ratification be approved. It will assist us to use what belongs to us, to use what was created for us so that we do not have side effects after taking our African drugs. I just wanted to add that point Mr. Speaker, thank you very much.
(v)HON. DR. MURIRE: Thank you Mr. Speaker Sir for giving me this opportunity. I want to add my voice to the issue of ratification of
African medicines. I am confident that is the right direction to go. Personally, I grew up in Chipinge, a community where African medicines are in abundance and are applied to everyone who gets ill. In our community Mr. Speaker Sir, African medicine is the first line of treatment before anyone goes to hospital, especially with regards to minor illnesses. Even women who give birth are first of all exposed to African medicines. In my view, ratification would be to the advantage of our country because the application and processing of those medicines would be regulated. Without regulation and the medicines being applied without standards, it means we might lose so many lives because there is no measurement and there is no experiment. It is unregulated and it is done in private. Mr. Speaker Sir, the best way to regulate the application and practice of African medicines is to have this ratification approved by Parliament. I thank you Mr. Speaker Sir.
THE HON. SPEAKER: Thank you very much Hon. Dr. Murire.
Tichauya ikoko kuChipinge.
(v)HON. DR. MURIRE: You are welcome Mr. Speaker.
(v)*HON. P. ZHOU: Thank you Mr. Speaker. I am supporting the ratification of the African medicines. I also come from Chipinge where there is a lot of traditional medicines. In Chipinge, when a person is pregnant, in order for her to deliver properly, they must use traditional medicines to deliver without complications, like elephant dung, et cetera. These traditional medicines help a lot and people know these traditional medicines. Even the Bible supports the use of traditional medicines because all types of trees and grasses, what we call flora and fauna were found in this garden. Even the ingredients of modern day medicines are taken or found in this garden. We cannot deny or discourage the use of traditional medicines because we will be lying to ourselves for modern medicines are taken from traditional medicines. Therefore, I support the use of traditional medicines. Modern day medicines do have proper dosages on how these medicines must be taken, therefore traditional medicines must have proper dosage. Those who practice traditional healing must be respected because they will be helping at their capacity. Thank you very much.
(v)HON. MOLOKELA-TSIYE: Mr. Speaker Sir, thank you so much. I would like to add my voice in support of the ratification process to the African Medicines Agency. It is good news for Zimbabwe. It is good news for Africa that we, as Africans, are now moving away from a colonial set up where we have to rely on medicines from other continents to address our own needs as a continent. It is long overdue that we unite as Africans and the African Medicines Agency should lead us in terms of economies of scale so that instead of buying or importing bulk medicines from India and other continents like Brazil and so on, we need to produce enmasse as Africans. This will help to put the prices of medicines in Africa down and it will also help us to trade among ourselves as Africans because the current system is not benefitting us more but it is benefitting other continents.
We want to encourage Zimbabwe to be one of the leading countries in this regard in supporting the African Medicine Agency. We also want to invest more, we want to challenge the Government of Zimbabwe to research more on research and development to ensure that we invest scientifically in our own very rich history and intellectual knowledge on medicines that was affected by the colonial experience. The colonial system did not respect African intellectual knowledge on medicines and we need to invest a lot of money in scientific research. In fact, universities such as the University of Zimbabwe should have institutions such as Centres for African Medicines Research. Institutions such as Midlands State University should have institutions with a centre for African Medicines Research so that we properly document and research to ensure that we bring these medicines into our pharmacists.
Our pharmaceutical system in Zimbabwe looks more foreign than local and it is time we should change that. We need to learn especially from the Asian countries like China, Korea and others which have managed to infuse their traditional knowledge of medicines with their colonial types of medicines. Zimbabwe and Africa at large have remained behind in this regard, so let us learn and make sure that we infuse the medicines we inherited from our colonial masters but also respect and acknowledge our own African traditional medicine systems.
We also want to encourage the Government to work closely with institutions that have knowledge. I know that the Zimbabwe National Healers Association, for many years has not been given enough respect and we want to encourage the Government to make sure that they respect ZINATHA and properly engage it to ensure that most of the knowledge that they have is scientifically documented. Thank you Mr.
(v)*HON. MASHONGANYIKA: Thank you Madam Speaker. I would like to support what other Hon. Members have said as we endorse our cultural heritage. In my opinion, the use of our traditional culture should be incorporated into college or institutional curriculum where modern medicine can be mixed through research, with traditional medicines. For example, if someone is suffering from abnormal blood pressure, they should not default on the intake of their daily medicines as prescribed by the medical doctors. However, they can as well use traditional medicine alongside modern medicine to help achieve a normal blood pressure.
There are chronic diseases such as diabetes and asthma where patients are expected to take in prescribed medicines for life. Such patients should be advised not to default on their medicine even while they use other traditional medicines. The medicines are so effective being taken without defaulting such that the patient will do better with time.
In the past, there were no clinics and our ancestors used traditional medicines to treat different ailments and they were healthy. We now realise that the traditional medicines and foods which we used to eat long ago are good for our health and we are resorting back to that. The modern foods which we adopted due to colonisation are not good for our health. We are resorting back to the foods which our ancestors used to eat such as dried traditional vegetables with peanut butter, grasshoppers and many different traditional and natural plants which made their bodies to be strong, healthy and resistant to colds.
Today we have a disease which we call COVID -19. I say God is good because even biblically, God provided treatment for different diseases and we get healed without using any money. Not all of us are able to earn money, it is very difficult for others, and hospitals require a fee for one to get treatment. We survived from plants which were provided by God such as zumbani and so on. Even today, we are still using those traditional medicines which were provided by God.
These traditional medicines should be readily available in supermarkets so that our people can buy without any form of fear as they will be labeled with instructions on how to administer at home. It is difficult for people to buy traditional medicines from the streets as they do not know how to take it or the medicinal benefits, but when it is labeled and sold from registered stores, it becomes trustworthy and people can buy without any form of doubt. We should continue using our traditional medicines. I thank you Madam Speaker. Most of the things have been said by other Hon. Members.
(v)*HON. CHIHURURU: Thank you Madam Speaker.. I would like to support what other Hon. Members have already alluded to. I reside in Chipinge – the issue of using traditional medicines is something that we can deny but it is real. Last month we had a child who was involved in an accident in my brother’s vehicle. The father refused to have his child taken to the hospital and indeed, the child was not hospitalised but taken to traditional healers for treatment. As I speak, the child is now up and walking. I was surprised to learn that the child is now walking. I just wanted to confirm that the use of traditional medicines is real even if we fail to admit, other people are living within that reality. I support the use of traditional medicines. Thank you for giving me the opportunity.
THE MINISTER OF JUSTICE, LEGAL AND
PARLIAMENTARY AFFAIRS (HON. ZIYAMBI): Thank you
Madam Speaker. I want to thank the Hon. Members for the support they have rendered in terms of the ratification of the African Medicines Treaty. Starting with Hon. Labode for the support that she gave and how expensive the drugs that we use are, because we never came together as Africans to try to harness what we have and reduce the cost of our drugs.
Hon. Nduna was also thinking of the need to beneficiate. In other words, we need to look at our medicines and this is what this Agency will do. It will look at our medicines, try to see how we can promote them and use scientific methods to do that. I really appreciate what the Hon. Members have been saying.
Hon. Simbaneuta Mudarikwa, about mbanje and its medicinal effects -I think those are some of the issues that will be looked into. Hon. Dr. Murire, from Chipinge, Chipinge is very famous for its medicines. I think we can tap from that knowledge base and promote our medicines. Basically the message that I got is Hon. Members are in support. In view of that, I move that this House resolves to ratify this Treaty.
Motion put and agreed to.
PENSIONS AND PROVIDENT FUNDS BILL [H. B. 17, 2019]
Second Order read: Committee Stage: Pensions and Provident
Funds Bill [H. B. 17. 2019].
House in Committee.
On Clause 1:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT (HON. CHIDUWA): Thank you Mr. Chair. I
move the amendment standing in my name that Clause 1 of the Bill on page 5, line 6 is amended by the deletion of “Pensions” and the substitution of “Pension.”
Amendment to Clause 1 put and agreed to.
Clause 1, as amended, put and agreed to.
On Clause 2:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHIDUWA): Thank you Mr. Chairman. I move the amendment standing in my name;
- On page 6, in line 11, by the deletion of “approved by the
Commissioner” and the substitution of “published in a notice by the Commission in the Gazette”.
- On page 10, in line 17, by the insertion of “including members, pensioners, former members, deferred pensioners and participating employers;” after “of the fund”.
HON. MUSHORIWA: Thank you Mr. Chairman. I just want first to acknowledge and applaud the Minister for having done the amendments that he has actually moved. However I need the Minister to look at the definition of valuator, on page 10, line 23, the (b) definition of valuator. The first part (a), I do not have a problem where the valuator means an actuary but the definition where it says “a member of such class of persons as may be prescribed by the
Commission”. I humbly submit Mr. Chairman that this (b) needs to be deleted. Why? We do not want to give the Commission a lot of discretion. When we say a valuator in terms of pensions, if you are going to say a valuator is going to be an actuary, we know it is somebody who is properly trained in that field.
The moment you allow the IPEC Board to then make its own decision to say we want to appoint bankers to be valuators or we want to appoint accountants or lawyers to be valuators, I think it creates a problem. Let pension retain its specialty. Let the actuaries do that work. In any event Mr. Chairman, we are doing so well now in our various tertiary institutions where we are now starting to produce a lot of these kids that are doing actuarial science. I submit.
HON. CHIDUWA: Thank you Mr. Chairman. I would want to thank Hon. Mushoriwa for the submission but I think when it comes to evaluation, what is needed is for us to understand the whole Bill. The whole Bill is specific that the evaluations are going to be done by actuaries. So, I do not see any ambiguity in terms of the way we defined those evaluators. Thank you.
HON. MUSHORIWA: Hon. Chairman, I think the Hon.
Minister’s submission supports my view. If the position is that the evaluation is going to be done by actuaries, I think (a) gets everything covered. There is no need for us to go to (b) because there is no reason why we should even want to ask other professions to come in and become evaluators in pensions and insurance matters when we have got people that have got specialty. We have been crying over the years that we do not have enough actuaries but now, we are moving towards that. So on this one, I want to beg the Hon. Minister to consider expunging this (b) from the Bill.
HON. CHIDUWA: Thank you so much Hon. Chair. On the
guidance of my technical team, what we are saying here is on the definition of evaluator. The intention is to induce other professionals other than actuaries owing to the scarcity of the skills in Zimbabwe and the related costs. There are small pension funds which can be valued by other professionals such as Accountants and we do not necessarily rely on actuaries. I am sure the Hon. Member can understand that the broad coverage is for us to ensure that we cover everybody from the small companies up to the big companies. Those small companies may not be able to procure the services of qualified and seasoned actuaries. So I still submit that the submission should stand as is. Thank you.
HON. MUSHORIWA: In light of the submissions by the Hon. Minister, would it not be fair to simply add something on (b) where you say - a member of such class or persons has been prescribed by the Commission. Why do we not list the sort of profession that you envisage if we are saying we have got a deficit in terms of the actuaries? What I am trying to do is to avoid a situation where you give an open-ended check. If there are certain professions that you believe need to be considered that can do the work for the actuaries, I will be in a position to agree with you but I am just persuading you to say, can we not list the sort of professions so that there is no ambiguity pertaining to this?
HON. CHIDUWA: Thank you so much Chair. I think the submission is well taken but I think our challenge is - are we going to be exhaustive? I think what is needed there is for us to be exhaustive if you are saying the list is supposed to be closed to ensure that it is not going to remain open. In terms of the recommendations that are there, they are saying listing all the professions is not recommended because why we are saying that is because the law is not futuristic and this is exactly my point where I was saying, are we going to be exhaustive? I therefore move the amendment standing in my name that:
- On page 6, in line 11, by the deletion of “approved by the
Commissioner” and the substitution of “published in a notice by the Commission in the Gazette”.
- On page 10, in line 17, by the insertion of “including members, pensioners, former members, deferred pensioners and participating employers;” after “of the fund”.
Amendment to Clause 2 put and agreed to.
Clause 2, as amended, put and agreed to.
On Clause 3:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT (HON. CHIDUWA): Thank you Hon. Chairman. I move the amendment standing in my name that: Clause 3 of the Bill is amended on page 10, in line 32, by the deletion of sub-clause 3.
Amendment to Clause 3 put and agreed to.
Clause 3, as amended, put and agreed to.
On Clause 4:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHIDUWA): I move the amendment
standing in my name that Clause 4 is amended on page 10, in line 34, by the deletion of “in consultation with” and the substitution of “under the direction of”. I so submit.
Amendment to Clause 4 put and agreed to.
Clause 4, as amended, put and agreed to.
On Clause 5:
HON. MUSHORIWA: I want to propose that Clause 5 in its
entirety be deleted from this Bill because of the two reasons. The Hon.
Minister is aware, we raised it even as a Committee on Budget and Finance that the piecemeal approach that the Hon. Minister had done does not serve the Insurance and Pensions well. He is aware that there is an Insurance and Pensions Bill which is actually underway. There is also an Insurance Amendment Bill which is also underway. In our view, the delegation and functions of the Commissioner are well covered under the Insurance and Pensions Act. If they are not well covered, there is a chance that the Hon. Minister will present these into that particular Bill because it will be tightened in that way.
My submission is for the Hon. Minister to concede to the deletion of this Clause 5 and that the other Clauses be numbered accordingly; because it will be a duplication and it will create more problems for those that want to follow the laws pertaining to the insurance and pensions. I submit.
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHIDUWA): Thank you so much Hon.
Chairperson and thank you Hon. Mushoriwa for the submission. Hon.
Members, I think what we should take note of is under the responsibilities and functions of the Commissioner, what motivated us to have that Clause is the issues to do with good corporate governance. I think we have all seen that Zimbabwe is very serious and committed to the issues of corporate governance and we have got a code of conduct that guides the Commissioners. So in this case, in order for us to have good corporate governance, it is important that the tenets require the Commissioner to execute his or her duties under the guidance of the Board as opposed to the provision of the current Act. So the Clause does not take anything away from the functions of the designated commissioner as provided under the IPEC Act so the proposal is acceptable.
So, in this case if we are saying we should delete, I think as Members, we need to look at it and say how do we differentiate what is supposed to be covered under the good corporate governance versus what you are saying that we should expunge the whole Clause. I am calling for further debate to say should we expunge it or we also look at the provisions of good corporate governance versus the functions of the Commissioners.
HON. MUSHORIWA: I think the Hon. Minister submissions
are not related to Clause 5 but to Clause 4. The Clause 5 that I am referring to, if you read it carefully, you will see under 1, it says “subject to the Insurance and Pensions Act”. Then it lists the powers and then on 5, “this Section shall be construed as being additional to or not being derogatory from the Commissioners powers of delegation under any other Act”. These issues under Clause 5 are well tabulated in the IPEC Act and because that Bill is actually on its way, if the Bills Digest that we get as Members of Parliament is anything to go by. My thinking is to say, this Clause 5 or even Clause 6 are not supposed to be part of this so that at least when we do the Amendment to IPEC Act, we will be in a position to incorporate all these so that it becomes tight.
HON. CHIDUWA: Thank you so much Sir. Having considered the submissions by Hon. Mushoriwa, we have checked and noticed that the expunging of that Clause is not going to take away anything from the functions as designated under the IPEC Act. So, the proposal by the Hon. Member is therefore accepted.
Amendment to Clause 5 put and agreed to.
Clause 5, as amended, put and agreed to.
Clauses 6 to 14 put and agreed to.
On Clause 15:
HON. MUSHORIWA: My submission pertaining to Clause 15 is
to do with page 18, 6 (a) where it says, “to constitute a quorum, there shall be present in person or by proxy in writing, members of the beneficiaries exceeding 50 percentum of the total members”.
Mr. Chairman, we submitted in our report as Budget and Finance that it is not practical to call for 50% of membership of a pension fund to participate. We gave a good example of the Mining Pension Fund. It has got close to about eighty something thousand membership. Even the smaller pension funds like in the banks, they will probably have about three to four thousand and the like. We had submitted and suggested in our report to this august House, to simply say that this clause needed to be amended so that it reads ‘members or beneficiaries representation of members’ instead of having the entirety of membership. It should be representation of members, because this will not even work from the word go.
This is so because there is no pension fund that can have a meeting where it has got all its members. It is even worse for those pension funds which have got their members dotted all over the country. It is not practicable. I would like to submit to the Minister, that this one in my view, needs a bit of amendment.
HON. CHIDUWA: I will stand to be guided by my technical team but whilst I am awaiting that guidance, I would want to engage the Hon. Member to say, in cases where we say instead of having the actual members and we have got the proxies, would it assist especially in terms of the 50% quorum representation? I am opening this to debate to say if we have got 50% representation which is coming from the actual members or their proxies, is it going to assist us?
HON. TOGAREPI: Minister, I think your proposal is difficult to implement. Infact, there will never be a quorum. Let us talk of National Railways of Zimbabwe; it has membership throughout the world. You can find them in Australia, UK and so forth. This means that there would not be any meeting. How will they nominate those proxies?
I think it is wrong to bring 80 000 people under one roof to constitute a quorum. In my view, I recommend as my colleague has put it, that let us look at representatives of these. They could be board of trustees or some other way of representatives rather than talking about a quorum of membership. It is a difficult situation to find. Even the smallest pension fund, you cannot bring them together. You will be just stopping the operations of that pension fund.
HON. GONESE: I also want to add my voice and associate myself with the submissions made by the Hon. Chief Whip and Hon. Mushoriwa. He said to the Hon. Minister, in terms of the intended provision in the clause, it refers to members being present in person or by proxy.
Proxies are usually practicable when you are dealing with small numbers because a proxy must be in writing. You cannot purport to represent somebody who has not given you that written authority.
I want to submit that notwithstanding the provision that other members may be present by proxy, it is not practical and it will be preferable to amend that intended provision to ensure that in practice it can be implemented. For example, at the Law Society of Zimbabwe where we have less than probably 2000 lawyers, it is easier to implement but here we are dealing with members of a pension fund. Some of the members do not have any direct interest to the extent that they will go out of their way to provide that proxy, then we have a situation whereby there will be no quorum or there will be subversion of the actual provisions where such meetings will take place without the quorum and in order not to cripple the operations of the pension fund, it will be better not to have that provision as currently formulated where it will cause problems and it would be very difficult when you have got those pension funds which have got thousands of members, some of whom will be scattered not just in Zimbabwe but even all over the world. That is why I believe that the Hon. Minister should accede to the submission by Hon.
HON. CHIDUWA: I have listened to the submissions by the Hon. Members and I am acceding to the submissions but in the form of a proposed amendment.
The original clause here is saying ‘to constitute a quorum, there shall be present in person or by proxy in writing, members or beneficiaries exceeding 50 percentum of the total members’. I am proposing this – from the word beneficiary there, I am proposing ‘as shall be provided in the regulations’. This means that we are removing the 50 %. This is what we will deal with under the others. I submit.
Amendment to Clause 15 put and agreed to.
Clause 15, as amended, put and agreed to.
On Clause 16:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT (HON. CHIDUWA): Mr. Chairman, I move the
amendment standing in my name that on page 20, in line 25, by the insertion after “exempt a participating employer” of “with the approval of at least fifty per centum of the employees so affected,”
HON. MUSHORIWA: Thank you Chair. I want to appreciate the Hon. Minister’s amendments on this clause where now he has included the question of the employees’ views to be considered by the Commission. We have submitted to the Minister to say that we wanted the employees but also we wanted the views from the previous funds. The challenge that we have with some of the employers Mr. Chair, is that they will fail to submit contributions or they will violate certain regulations of a particular pension fund. When they are put under a corner, they will decide to simply say we are now pulling out and we are now going to join another fund. The amendment that the Minister has put, whilst it is progressive in the sense that you are now asking the employees’ views, we feel Mr. Chair, would it kill if we were going to also ask the view from the fund that this employer has been under? Given the state of our economy at the moment, there are certain employers who may coerce the workers to simply say if you do not agree with this, your jobs will be on the line and workers will end up just agreeing. If we are going to have the application by the employer supported by the employers and supported by the fund that they were in, - admittedly Chair, we are aware that the fund may not want to release to a member like an employer but truly we should get something in writing pertaining to the conduct and behaviour of that employer from the previous fund where he or she was a member before moving to another fund to guide us so that we do not have chaos in the industry.
HON. CHIDUWA: Thank you Mr. Chairman. The submission by Hon. Mushoriwa is accepted and we are going to deal with the matter when we look at the regulations. I thank you.
Amendment to Clause 16 put and agreed to.
Clause 16, as amended, put and agreed to.
On Clause 17:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHIDUWA): Mr. Chairman, I move the
amendment standing in my name that on page 21, in lines 6 to 9 after sub-clause (5), by the deletion of sub-clause 6 and the substitution of the following sub-clauses;
“(6) Where a participating employer fails to remit pension contributions for a period of three months, the Commissioner shall direct the employer to remit such contributions to the fund within such period as the Commissioner may specify: Provided that before giving the direction to the participating employer, the Commissioner shall invite representations from such employer, to give reasons for the non-remittance of contributions;
(7) for purposes of subsection (6), every inspector appointed in terms of this Act shall have powers to demand information from the participating employer in relation to pension contributions, including—
- a) banking details of the employer;
- where the employer alleges that the contributions were remitted, proof of payment of such contributions;
- where contributions were not paid, reasons for non-payment of contributions;
- names of employees who or ought to have benefited from the contributions;
- any other information the inspector may consider necessary and relevant.
(8) Where a participating employer fails to comply with a direction made by the Commissioner in terms of subsection (6), the Commissioner shall direct the bank of such employer to remit outstanding pension contributions to the fund, either by way of a single instalment or such number of instalments as the Commissioner may specify.”; and the subsequent sub-clauses shall be renumbered accordingly.
Amendment to Clause 17 put and agreed to.
Clause 17, as amended, put and agreed to.
Clauses 18 to 22 put and agreed to.
On Clause 23:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT (HON. CHIDUWA): Mr. Chairman, I move the amendment standing in my name that Clause 23 of the Bill is amended on page 24 in line 12 by the deletion of “three funds” and the substitution of “one fund”.
HON. MUSHORIWA: Mr. Chair, I want to thank the Minister for the amendment that he has moved. However, I want to start with Clause
23 (1) – my suggestion is that, where it says, ‘the board shall consist of at least 5 members and a maximum of 9 members of which at least ½ shall be elected by the members. I want to propose that the word ‘at least ’ be replaced by the word, ‘the majority,’ so that the majority of the
people who sit on the board are elected rather than have a situation where you say ‘at least ½’. In any event Mr. Chair, it serves both the contributing members and pensioners who also need to be represented on the board. The position to simply say ‘the majority’, would suffice.
Secondly, I want to submit to the Hon. Minister that Clause 1(a), Clause 1 (b) and Clause 1 (c) should all be deleted from the Bill primarily because this gives a lot of discretion to the Commission and it is actually problematic. I will start with Clause 1 (a) which says, ‘if satisfied that a five-member board would be impractical or unduly expensive or is not in the best interests of the Fund, authorise the Fund to have a board of fewer than five members.’ If we allow that section to stand, I think it will not make sense. We will end up having a board of three members or even less. There is no situation where you have a pensioner who is…
Hon. Members on the virtual platform having been making noise.
THE DEPUTY CHAIRPERSON OF COMMITTEES: Order
Hon. Members on virtual.
HON. MUSHORIWA: This discretion that is being given to the
Commission should be removed. Let us simply say that ‘a Fund shall have a Board of between five and nine, the smallest we choose five and the biggest we choose nine. I also disagree Hon. Chairman in the provision under Clause 1 (b) to simply say that we can allow the Commission to allow a huge board with more than nine members. In my view, it is not right to then have the Fund managers of the board members chewing into the pension funds. The best thing in my view, nine members is big enough and should remain as it is. So, Clause 1 (b) should also be deleted.
Then Clause 1 (c), I think this one also needs to be removed. There is a lot of discretion which is being given to the Commission to exempt the Fund from the requirement that at least half of its board members shall be elected by members. That is actually dangerous Mr. Chairman, because we end up having some unscrupulous employers literally managing and controlling everything. That will actually be a danger to the future pension and insurance industry. So, in my view those three need to be deleted and the word ‘at least ½’ be replaced by the word, ‘the majority.’
HON. CHIDUWA: Thank you Chairman and thank you Hon.
Mushoriwa for the submission. I think we need to look closely at that
Clause where there is ‘at least ½’. What motivated that Clause is the issue of representation of interests, the interests that we are looking at here are those of the employer and those of the employee. So we needed to balance those two interests. If we relook at that Clause and we say we would like to ensure that the interests of both the employee and the employer are balanced, then I still submit that ‘at least ½’ should stand. I submit.
The submission is on how to deal with too much discretional powers and that we should expunge Clause 1 (a), 1 (b) and 1 (c). However, if we look at Clause 1 (b), you will see that it is meant to give discretion to deal with exceptional circumstances. I can accede to the expunging of (a) and (c), but if you look at (b) you will see that it is meant to give discretion to deal with exceptional circumstances. I submit.
HON. MUSHORIWA: I would like to thank the Minister for the expunging of (a) and (c). What I just wanted to inquire – I am not a lawyer myself, when there is a board of an odd number, 5 and 9, when you say ‘at least ½’ in a board of 9, it means 5 is at least half because 4½ cannot be the number, 4½ to the nearest is 5. Is my reading correct to simply say that 5 will be the at least ½?
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT [Nodded in agreement.] –
Amendment to Clause 23 put and agreed to.
Clause 23, as amended, put and agreed to.
Clauses 24 to 30 put and agreed to.
On Clause 31;
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHIDUWA): Thank you Mr. Chair. I move
the amendment standing in my name on Holding of Assets of Fund, that Clause 31 of the Bill as amended on page 30, in lines 28 to 29, by the deletion of “or any other person who is approved by the Commission or who is a member of a class of persons approved by the Commission”.
Amendment to Clause 31 put and agreed to.
Clause 31, as amended, put and agreed to.
On Clause 32:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHIDUWA): Thank you Mr. Chair. I move the amendment standing in my name on Accounts and Financial Statements, that Clause 32 of the Bill is amended on page 31, in lines 9 to 12, by the deletion of sub-clause 3.
HON. MUSHORIWA: Thank you Mr. Chair. I want to thank the Hon. Minister for that amendment, it is actually very good. I would want the Minister to further do another amendment on 4. I want the Minister to amend this by the deletion of the words “unless exempted by the
Commission”, so that it will then start by saying “every fund” then it continues like that. This discretion Mr. Chairman, to me it is not important to be there. I have actually looked at even the smallest pension funds in this country, the very smallest pension fund. No pension fund can fail to publish in a newspaper because the cost thereto is actually very minimal and it is possibly less than US$50. So, I do not think this will affect much. I request the Hon. Minister to amend this by removing “unless exempted by the Commission” so that we know it is every fund other than the insurance. I know this because I have been a member of a very small pension fund and I know that every pension fund has got the capacity to do small adverts once a year.
HON. CHIDUWA: Thank you Hon. Chairman and I also thank
Hon. Mushoriwa. Your proposal is to ask us to delete the words “unless exempted by the Commissioner”. If we look at the whole Clause 32 (iv) and then you look at the financial capabilities of pensions funds from the smallest to big ones, we allowed the discretionary powers of the
Commissioner to be applied on this one. Why, because we noted that it is expensive on the part of small pension funds to publish in the public media and this is why we allowed the discretionary powers of the
Commissioner to prevail. This is what guided that clause, I submit.
(V) HON. TOGAREPI: Thank you Mr. Chairman. It is the duty of the Commission to protect the interest of pensioners or members of the pension fund. If the Commissioner sees that looking at the costs that accumulate at that fund, the benefits that will then accrue to the members will go down, I think it will be good to give the Commissioner those discretionary powers to protect the members’ interests.
HON. MUSHORIWA: Mr. Chairman, the submissions by the Hon. Minister even the one that the Hon. Chief Whip has submitted, it is actually contained in the clause. If you read the clause well, it is not only about newspapers. It says that “shall cause financial statements to be published in a newspaper for appropriate circulation” then there is “or” in any other manner approved by the Commission. So, what it means is that if you remove the “unless exempted by the Commission”, it is already covered because there is “in any manner approved by the
Commission”, meaning that a pension fund that cannot do a newspaper article can actually submit to the Commission and the Commission can then approve. So, it is already covered. My only query Minister is to start Clause 4 with “unless exempted” then you will include it again under approval, it does not read well. The smallest pension fund is being given a leeway to simply say it is not only the newspaper, you can be allowed to send by WhatsApp, publish it on a website and do it on Facebook, which is not costly. So it is already covered. I pray to the
Hon. Minister to say, let us remove these five words “unless exempted by the commission” so that it starts, “every fund other than the insurance company scheme shall cause its finances to be published in a newspaper of appropriate circulation or in any other manner approved by the commission.” The commission’s powers are there; they are not being removed.
HON. CHIDUWA: Thank you so much Chair. Thank you Hon.
Mushoriwa for the submissions. Looking at our earlier submissions where we said it is expensive for small pensions funds to be able to publish in the public media, having re-looked at the clause, it is providing the leeway that in cases where small pension funds are not able to publish in print media, there is that leeway for them to publish in other alternative media that can actually be cheaper compared to the public media.
Also, the issue of us giving the discretionary powers, still those discretionary powers are not expunged even if we remove them unless exempted by the Commissioner. I do not think this is going to dilute the Act, so I am submitting that the proposal by the Hon. Member is accepted. Thank you.
Amendment to Clause 32 put and agreed to.
Clause 32, as amended, put and agreed to.
On Clause 33:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT (HON. CHIDUWA): Thank you Mr. Chair. I move the amendment standing in my name that on Clause 33, which is on life insurers, to maintain separate pension funds and separate accounts so that Clause 33 of the Bill on page 32 is amended by the insertion of a new sub-clause 8 as follows—
“(8) Any person who fails to comply with this section shall be guilty of an offence and liable to a category 1 civil penalty.” Amendment to Clause 33 put and agreed to.
Clause 33, as amended, put and agreed to.
Clause 34 put and agreed to.
On Clause 35:
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC DEVELOPMENT (HON. CHIDUWA): Thank you Mr. Chair. I
move the amendment on Clause 35, which is on investments.
Clause 35 of the Bill is amended on page 33—
- In line 10 by the deletion of “all or” after “invest”;
- On page 33 in lines 41 to 43 by the deletion of the proviso.
HON. MUSHORIWA: Mr. Chair, I want to thank the Minister for the amendment. However, I want to draw attention to the Hon. Minister on 35 (b). I want to submit that the amendment that the Minister is proposing is not good enough in my view and also in the view of the Committee. I want to paraphrase and start by saying the
Minister in his amendment is removing the words invest so that Clause (b) now says a fund to invest part of its assets in foreign markets, subject to such terms and conditions as the Commission may fix.
Mr. Chair, I want to submit to you that developed countries and most countries worldwide have actually built their countries through pension contributions. Whenever you then have a clause that gives a leeway for a pension fund to invest in a foreign country, you are creating a problem. The question that you need to answer is, who are the people who are paying the pensions? It is us the Zimbabweans. The workers are the ones that are contributing. Yes, we need them to get more returns. However, I will be happier if the Minister had amended this so that a fund can invest not more than 25% of its assets in foreign markets so that the majority of the funds are invested in Zimbabwe.
Right now we have got a problem Mr. Chair, of National Railways of Zimbabwe. They have got some properties that are in UK and over time, they lost track and some of the assets ended up being taken by some vultures. So in my view, I want to persuade the Minister to simply say, on investment, let us put a ceiling, to say a Fund to invest not more than 25% of its assets in foreign markets, that is one.
The second one that I want the Minister to consider is on 3(a) – which says ‘subject to subsection 7, no Fund shall invest or expose whether by way of loans or otherwise more than a percentage prescribed by the Minister. I want this percentage to be in this Bill. I do not want this to be under-regulated. For the simple reason, the problems that the pensioners in Zimbabwe suffered from 2009 up to now is primarily because the Pension Fund Managers, some of them took internal loans. They borrowed from the Pension Fund to set other businesses and the pensioners then suffered.
The current crisis we have with our pensioners right - some of it has been due to insider trading by these directors and pension fund managers. In my view, I want the Minister to consider my proposal to say, under A, the percentage should actually be put at least 15%. Not more than 15%. We do not want to have a situation Mr. Chairman, where we see pension funds - You know what they do, they will have Mushoriwa Pension Fund. They will take the funds from Mushoriwa Pension Fund to then invest in Mushoriwa Investments. People may not notice; they simply see the name Mushoriwa, but they do not understand that these are two different entities. So, to avoid that, I propose Minister, let us set a figure. I will be happier on 10% or even 15% in terms of the exposure of the Pension Fund in regards to loan. We know this Mr. Chair. We have got pensioners who are crying out there. I thank you.
HON. CHIDUWA: Thank you Hon. Chair. I would like to thank
Hon. Mushoriwa for the submissions. Before we come to an agreement,
I think we need to understand the operations of our Pension Fund in broad terms with regards to some of the agreements that we entered into as a country. Cross border trades are promoted within our SADC.
Where we are going at the moment as a country with regards to the Africa Continental Free Trade Area, where as a country again we have acceded to SADC.
Now the worry that the Hon. Member is having is a situation where such investments are not going to be brought back to the country. Where they will not contribute towards, let us say the infrastructure development of the country. Within our Act, we already have got a provision where Pension Funds are supposed to invest a certain percentage of their asset levy. So, I think we may need to have the actual percentage on that but already that provision that Pension Funds should invest a certain percentage of their assets in this country is there. I think your worries are already covered. May be there may not be any need for us to change the 35%.
With regards to exposure, you are proposing that we should have a specific percentage; this is looking at the exposure of the Pension Fund to the loans. You are proposing 15%, on that one. I will need to be guided by the technical team because I think the issue of the risk could require some appropriations. So let me stand to be guided by my technical team but on the first one, I am sure we agree that it is already covered within out statutes that Pension Funds should invest a certain percentage of their assets. Thank you.
HON. TOGAREPI: Thank you Hon. Chair. I want to agree with the views of Hon. Mushoriwa. I think the issue of not coming up with a strict cap as to what we are going to be investing outside the country is exposing pension funds or people who are retiring to a lot of risks. I think let us have a very strict limit to that exposure. The issue that the Minister is raising around what we call prescribed assets where members will then invest to Government prescribed assets; at the moment it is very minimal, unless I have lost track. Very minimal and it is not going to protect what we will lose by allowing money to go out. The good example that you gave about the National Railways of Zimbabwe and many other pension funds that invested outside Zimbabwe can be monumental to an extent that people will die in abject poverty if we do not protect.
The purpose of the Commission (IPEC) is to protect members from
losing what they will have suffered for the rest of their lives. So, I think if there could be some income or value that can be derived from investing in SADC or wherever, let it be minimum and a strict cap based on our fear of those risks that we will not be able to protect. There could be changes in terms of laws out there and we may not be able to protect our members. IPEC may not have control over those monies when they go out. Let us have little or less of percentages of any pension fund that is not within the purview of IPEC going outside, so that we remain in control of pension funds.
I suggest that we have a cap, 25% to me it will still be very high. The Minister will agree that we have pension funds that have been lost and they were lost by companies that run pension funds who are doing business in Zimbabwe today. They form companies outside Zimbabwe and ship people’s monies out. We have learnt from these mistakes. We have lost so much value for our pensioners. We cannot risk and think that we are going to get a return that will surpass what we can get in Zimbabwe. I think that is not a correct thing. I thank you.
HON. CHIDUWA: Thank you Hon. Chair. I would like to thank Hon. Members for their submissions. What we are saying here is we need to protect the interests of the country, as much as foreign investments are allowed. The issue is to what extent are we going to protect the interest of the country. Having considered the submissions by the Hon. Members, I agree to their proposals that we need to put a cap. The agreement here is for us to say the proposal for us to have a cap is agreed but in terms of the actual percentage, that is going to be covered under the regulations. So we are accepting the proposal that we need to limit offshore investments; there is need for a cap but in terms of the actual percentage, then this is going to be in the regulations because we would need also to consult Reserve Bank so that we are in line with the Exchange Control Act. Thank you.
Clause 36 put and agreed to.
On Clause 37:
HON. MUSHORIWA: I just want the Hon. Minister to explain to
the House on 37.2; the idea of appointing inspectors. We agree with it. However if you read 2, it says, ‘the Commission may appoint a body corporate’, meaning that it can be an organisation as an inspector in terms of subsection 1. Where you appoint an organisation to be an inspector, you are then saying all officers and employees of the body corporate who are designated by the body corporate head shall be inspectors.
I would like to find out what is the mischief here, the question of the body corporate. How does it come in, what is the intention? Do you foresee a situation where you are going to appoint a company or an organisation to do other work that cannot be done by inspectors so appointed by the Commission?
Again, to then leave the discretion to the corporate head, that if the corporate head decides to say all the employees in his organisation are inspectors and you are giving them the blanket, I think the duty of the Commission will be undermined.
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT (HON. CHIDUWA): Thank you Hon. Chair and
Hon. Mushoriwa for the submission. This is very important, especially if you look at the way you have analysed these clauses. However, we need to understand this clause in line with some of the discussions that we had earlier on specifically for this one where we are referring to a body corporate. In this case a body corporate can be a forensic audit company and then in this case in terms of responsibilities, it will lie with the head of the forensic audit company. So, this will happen in cases where we would want an investigation to be done. Therefore, this is why we included it and where we said the Commission may appoint a body corporate.
So, in this case it might be a forensic audit company, the forensic audit company is appointed as an inspector. The responsibility now for all the employees that are under the forensic audit company lies with the head of that corporate board.
Clause 37 put and agreed to.
Clauses 38 to 53 put and agreed to.
On Clause 54:
HON. MUSHORIWA: Thank you Mr. Chairman. I move that
Clause 54 (1) be amended by the deletion of six and replaced by three. It is now the standard procedure in all Government institutions and even in terms of the Corporate Governance Act. It is three months for submissions of financial statements by these State entities to the
Minister so that the Minister will be in a position to submit them to the House. I want to propose the amendment by the deletion of the word six and replace it by the word three. Thank you.
THE DEPUTY MINISTER OF FINANCE AND ECONOMIC
DEVELOPMENT (HON. CHIDUWA): Thank you Chair. The
proposed amendment by the Hon. Member is supposed to be in sync with the current provision as what is obtained in other State owned enterprises. So for this specific one, the industry submits to IPEC within three months as you submitted. IPEC also needs three months to be able to prepare and make its submission which is based on the submission by the industry. Fundamentally, it is three months but for IPEC, it will become six months. I submit.
HON. MUSHORIWA: Hon. Chair, I hear what the Hon. Minister
is saying but with due respect, if you read the entirety of Clause 54, it will tell you that IPEC is supposed to be doing quarterly reports. What it means is that the first quarter report will be there, the second quarter report and the third quarter report will be there. The only thing that will be left is the last quarter of the year and that should be in a position to be done before the 31st of March.
The reading of the Corporate Governance Act pertaining to this issue of the submissions of reports is very specific. There is a reason behind it to ensure transparency. We cannot reward IPEC by giving them all that period. If you go to three, the Commission shall submit to the Minister a Quarterly Report in regard to pension and provident fund business. So, it is already there. It is not like you are asking them to just start from January to December to do that. They already have the aggregate and if they are so good, they could have a projection because the first quarter report, the second quarter report and the third quarter report is already given.
If we pass this as six months, it will be the first of its own because this will create laziness. One of the things that is important which I wanted to just advise the Hon. Minister is the problem we faced when we did Public Hearings, that members were so angry with the manner in which IPEC does its business. They complained that they have got this lackadaisical approach. You submit a complaint and you do all those things.
We are basically saying three months in my view is sufficient. Just imagine if you submit six months to the Minister. What it means is that the Minister will then need to submit to Parliament thereafter, but do you know how Parliament calendar is normally like? By the time we reach around August, we are coming to the end of the session. It means that we will not consider this report. The House will not have the time to consider this report. Pensions are the backbone of a country. In this report we are not asking for anything but it is just a mere report. If they had been doing their work all the year, they should be in a position to give this report within a month to the Minister and three months down the line, it is submitted here. Thank you.
HON. CHIDUWA: Thank you Chair and thank you Hon.
Mushoriwa for the intervention but what I would want to inform the
House is that the quarterly reports that have been referred to by the Hon. Member are not based on audited accounts and actuarial valuation reports. In order for us to come up with the annual returns, those annual returns you referred to as provided for in Section 54 (1), they are based on audited financial statistics and actuarial valuations. So you can see the difference between the finance annual returns versus the quarterly reports. The quarterly reports are not audited but when we submit the final, they are supposed to be audited and based on actual actuarial valuations. This is why we still submit and ask this august House that for IPEC, we would need six months. I submit.
HON. MUSHORIWA: Hon. Chair, can I have your indulgence. I
just want to draw the attention of the Hon. Minister and I am going to give examples which are under his Ministry. The Reserve Bank and the Stock Exchange, all of them do it within three months. There is nothing special about IPEC. IPEC is in a position in my view to do this work within this period. The problem that we are going to have is giving six months – what I can basically tell you is that we are going to continue to have the circle of the problem that we have had with the pension in this country. This is because even this House will not have the capacity and chance to look into this report. I can bet you that the reports that we will consider in this House will always be probably two years old. I want to plead with the Minister; this one, three months is sufficient. Thank you.
HON. TOGAREPI: I also want to concur with the Hon. Member
on three months. I know it is difficult but if a report comes after a year, you will have lost a lot, especially on corrective measures. You will get a report that has heinous information which you should have corrected but it has been overtaken by time. IPEC has actuaries and many other competent people, it is well versed with this business on what is happening at the Reserve Bank and Stock Exchange. They demand, that is why they are there. They should also lead by example, they run and supervise what happens in the Insurance Industry. They want reports on time so that they take corrective measures but they do not want to come up with their final report in time so that even Parliament can assess their performance. We assess them a year later when we could have fired them two years back. After two years, sometimes they would have corrected the mess. I think three months will do, let us set a standard like other entities in the same industry.
HON. CHIDUWA: I want to thank Hon. Togarepi and Hon.
Mushoriwa for the submissions. As I have already submitted, the reports that are produced in terms of the Public Entities and Corporate Governance Act are the ones that are supposed to be submitted within three months. IPEC is also submitting the similar reports within three months, but if we look at the specific one that we are dealing with here where we are looking at the annual returns, these are coming from within the industry and these are filed within three months. I think we need to give that demarcation and differentiation between the reports that are in terms of the Public Entities and Corporate Governance Act and the final returns. IPEC too is complying with the three months. I submit.
(v)HON. R. R. NYATHI: Hon. Chair, I concur with what Hon. Mushoriwa and Hon. Togarepi have said. I think where the Hon. Minister is missing the point is that these are already running entities and if they are already running, it means the first time that they come into business, they might require six months. Three months for the preparation of the documents but once they are already running, then it becomes successive, which means Parliament would require those reports every three months. I am saying this because these organisations are already running. I want to submit that maybe the Hon. Minister can relook into that recommendation.
HON. MUSHORIWA: Having listened to the Minister, can we
then reduce the period from six to probably four months to give them that extra month because six months - to be honest, it will be too late.
HON. CHIDUWA: I want to thank the Hon. Members who have
just contributed. We are saying six months but for us six months is the upper limit, meaning to say that such reports can also be produced maybe within a period of four months or five months, but not beyond six. Hon. Mushoriwa is now requesting for four months. I know it is not easy because on this one, we were guided in terms of the work that is involved. Having considered this, as a compromise, we can put the cap to four months and this is not going to be easy for IPEC to be able to come up with audited financial statements. As a compromise, we are limiting ourselves to four months, not six months. I submit.
Amendment to Clause 54 put and agreed to.
Clause 54, as amended, put and agree to.
Clauses 55 to 65 put and agreed to.
Bill reported with amendments.
Bill referred to the Parliamentary Legal Committee.
On the motion of HON. TOGAREPI, seconded by HON.
MPARIWA, the House adjourned at Twenty-two minutes to Six o’clock p.m.