BY MBONGENI NDLELA
MBABANE – “Civil servants must not be made worse off,” Public Service Pensions Fund (PSPF) CEO Masotja Vilakati has urged, as the debate over the conversion of the Eswatini National Provident Fund (ENPF) into a National Pension Fund continues to stir uncertainty among workers.
Addressing Editors and the media in Mbabane, Vilakati unpacked the fund’s concerns, warning that while reforming pension systems is an important national step, civil servants’ hard-earned contributions and benefits must remain safeguarded.
Concerns Over Civil Servants’ Exclusion and Protection
Vilakati emphasized that PSPF supports the conversion of ENPF for its members, but excluding civil servants, since government is not committing additional funds. He reminded the public that civil servants were excluded from ENPF as far back as 1974 and catered for under separate legislation.
“Reducing PSPF contributions or including civil servants in the conversion will make members worse off. Pension rights are protected under both the Pensions Order and the Constitution of the Kingdom,” he said.
Legal and Financial Sustainability Questions
The PSPF boss further raised legal issues, warning that forcing civil servants into two statutory funds could be unconstitutional and financially unsustainable.
• No new budget allocation: Government has not provided fresh funds to support the conversion, which means contributions from the state as employer would be reduced.
• Deficit risks: Any reduction in contributions would require reducing benefits, a move Vilakati said is not legally supported and would push PSPF towards unsustainability.
• Constitutional protections: Section 195 of the Constitution guarantees pension rights, ensuring that PSPF members cannot be placed in a worse position than they currently are.
Independent Pensions Model in Africa
Vilakati also highlighted international trends, noting that across many African countries, national pensions and public service pensions are run separately and independently. Both actuarial experts consulted on the matter, he said, agree that ENPF can be converted without including the civil service.
Furthermore, the ENPF Bill’s clause against “double benefiting” from two public schemes seems to apply only to PSPF members, raising the question of why civil servants are included at all.
Impact on Younger Members and Future Costs
According to PSPF, the new framework could harm the sustainability of the fund by:
• Reducing contributions of younger members, who are vital to sustaining pension funds since they contribute for long periods without claiming.
• Forcing benefit reductions, making retirement packages lower than the current PSPF scheme.
• Doubling long-term administrative costs by placing the same employees into two statutory pension funds.
Clear Call for Amendments
Vilakati called for urgent amendments to the Bill, stressing that if civil servants are to be included, it must be as an addition without interfering with PSPF. Clauses such as 3, 69, and 107 must be clarified or rewritten to remove ambiguities and contradictions.
“TUCOSWA and public service unions were not consulted. It is vital that any changes are carried out through proper legal and negotiation processes,” Vilakati noted.
Conclusion: Protecting Workers’ Future
The PSPF maintains that it is not against pension reforms but insists that reforms must not jeopardize the stability of civil servants’ retirement security.
“Civil servants dedicate their lives to serving the nation. Their pensions are a promise of dignity after years of service, and that promise must be protected,” concluded Vilakati.
(Pics: Eswatini Observer)
