The Universities Retirement Fund and the NamWater Retirement Fund have distanced themselves from the inclusion of a compulsory preservation clause in the Financial Institutions and Markets Act (FIMA),as the fallout over the decision continues.
Antoinette De Greeff, from the Universities Retirement Fund said although the fund participated in the consultation stages of the FIMA regulations, it never acceded to the compulsory preservation clause.
“Consultations by NAMFISA took place through various industry representative bodies who actively participated in this consultation process. The proposed compulsory preservation provision was then vehemently objected against. The impression that is now being created that the Trustees accepted/ approved/recommended this compulsory preservation clause is absolutely not correct. No Fund was consulted on an individual basis in this regard,” she said in a notice issued to the fund’s members.
Elsabe Botes from the NamWater Retirement Fund said the fund had only participated in the FIMA consultation process through industry representative bodies.
“Your fund through various industry representative bodies actively participated in this consultation process and the impression that is now being created that the trustees accepted/approved/recommended this compulsory preservation clause is absolutely not correct,” she said.
The NamPower Provident Fund called on the FIMA preservation clause to be discussed before being passed into law.
“NamPower Provident Fund expects that the compulsory preservation aspect will be discussed in detail at an industry platform that is to be held, where the industry expects will be consulted to add value to the drafting process.”
The country’s largest pension fund, the Government Institutions Pension Fund has called for calm regarding the proposed regulations, amid concern workers could retire en masse ahead of FIMA’s enactment deadline.
Finance minister Ipumbu has the final discretion to review or rescind the proposed regulations before the are gazetted into law.
The Namibia Financial Institutions Supervisory Authority (NAMFISA) has already come out in defense of the regulations despite wide criticism, arguing that the preservation of retirement benefits will ensure that a portion of employees’ retirement savings is preserved throughout their working lives.
The draft regulation will apply indiscriminately to every retirement fund registered under the Financial Institutions and Markets Act (FIMA), and the compulsory preservation of retirement benefits will apply to all retirement benefits that becomes due to, and to contributions made by, members of retirement funds following the date on which the FIMA comes into force.
