GENERAL ASPECTS OF PENSIONS IN ZAMBIA AS A SOCIAL PROTECTION SYSTEM:
1. PREAMBLE
In order for the members of the committee to appreciate this submission it would be imperative to give a brief overview of the role of the Office of the Registrar of the Pensions and Insurance in the social security system in Zambia.
The Office of the Registrar of Pensions and Insurance dubbed “The Pensions and Insurance Authority” is an office established under the Ministry of Finance and National Planning. The office was established in February 1997 after the enactment of the Pension Scheme Regulation Act No. 28 of 1996 to serve as a supervisory and regulatory institution for the pensions and Insurance industry. The insurance industry is supervised through a different Act i.e. the Insurance Act No. 27 of 1997.
Therefore, Pensions & Insurance Authority’s role in the social security sector borders around the aspects of social insurance, which deals with measures to protect income earners and their families against a reduction or loss of income as a result of exposure to risks that impair one’s capacity to earn the income. This is done through establishment of occupational pension schemes, whether private or public. The Pensions and Insurance Authority thus regulates and supervises the overall operations of these institutions to ensure protection of the rights of the contributors. This is done through ensuring that the aspects of the Pension Scheme Regulation Act No. 28 of 1996 dealing with compliance are adhered to.
In view of the foregoing this paper will place more emphasis of social security in terms of pension schemes.
2. GENERAL SOCIAL SECURITY SYSTEMS DEFINITIONS
To understand the social security system one needs to be conversant with the terms that have been adopted world over and in particular in the Southern African Development Community (SADC) region. These are social allowances, social assistance, social insurance, social protection and social security itself. However, it should be noted conceptually that social security includes all the other four.
(i) Social Protection
This refers to measures whether public, private or mixed designed to protect individuals against life cycle crises that curtail their capability to meet their needs. The main objective is to enhance human welfare. In view of this we consider it to go beyond social security as it also covers social services and developmental social welfare, which is dealt with under the Ministry of Community Development and Social Services (MCDSS).
These are universal payments usually made to the most vulnerable that are exposed to exceptional need e.g. children - older persons, persons with disabilities etc. These are usually not means-tested and are a mere form of social compensation. Naturally, this funded from government revenue.
3. SUSTAINABILITY OF THE SOCIAL SECURITY SYSTEM IN ZAMBIA
i) Policy, legal and regulatory framework of the Zambian Social Security System
a) Policy
(I) Background
The social security system development in Zambia has had its own shortfalls since independence. The government has been ensuring existence of a vibrant social security system, however, this could not come to fruition. Systems continue to be unbalanced and concentrated on individuals in formal employment and the vulnerable (i.e. with donor support). Individuals in informal employment have continued to be sidelined.
It should be noted at this point that the Ministry of Labour and Social Security is the major stakeholder in the development of the government policy on social security. This can be appreciated through government’s efforts by establishing the social security department within the Ministry in 1992. In order to involve all stakeholders in the development of government policy, the Minister of Labour and Social Security appointed a tripartite National Social Security Reform Implementation Committee (NSSRIC) to advise him/her on the mechanics of this reform.