Clarify on pension funds: Opposition

Shadow Minister for Labour and Employment Cecilia Pareso yesterday challenged the government to clear the confusion surrounding the liquidity of pension funds. PHOTO | FILE 

By Samuel Kamndaya The Citizen Reporter  

 

In Summary

• Shadow minister wants to know who is telling the truth following conflicting statements by President Kikwete and Controller and Auditor General Ludovick Utouh

Dodoma. A recent statement by President Jakaya Kikwete that no pension fund will go bankrupt sparked debate in Parliament yesterday, with the Opposition demanding to know the fate of pensioners’ money.

Debating the 2013/2014 budget estimates of the Ministry of Labour and Employment, the opposition spokesperson for the docket, Ms Cecilia Pareso, said the government was giving conflicting statements on the state of pension funds, and asked the responsible minister, Ms Gaudensia Kabaka, to clarify.

In April, Controller and Auditor General (CAG) Ludovick Utouh raised the red flag on the performance of the Public Service Pension Fund (PSPF), saying it suffered a loss of Sh6.5 trillion.

Briefing journalists on various audit reports, the CAG called upon the government to intervene and save PSPF from imminent collapse.

But President Kikwete allayed public fears on May Day, saying that pension funds were not cash strapped.

He said the government had made it possible for investments by pension funds to increase from Sh3.38 trillion in May 2012 to Sh4.24 trillion in May 2013.

The value of pension funds’ assets went up from Sh3.74 trillion to Sh4.73 trillion during the same period, he added.

The Opposition yesterday asked the government to clear the confusion.

“We want the minister to tell Tanzanians who is telling the truth.  Is it the President or the CAG?” Ms Pareso asked.

She said while the government had promised to start repaying part of the Sh6 trillion it owed PSPF with an initial payment of Sh50 billion in 2013/2014, this was not indicated in Ms Kabaka’s budget.

1. She said various pension funds have erroneously given out loans worth Sh452 billion to the government for the construction of the University of Dodoma, saying such loans may disrupt financial flows in the funds’ cash accounts.