Nyashadzashe Ndoro
ZIM NOW REPORTER
A Zimbabwean senator raised concerns about the erosion of pensions due to hyperinflation and called for compensation for pensioners and policyholders in US dollars.
Senator Sesel Zvidzai this week cited the economic hardships caused by hyperinflation between 2006 and 2009, saying that the currency reform exercise that replaced the Zimbabwean dollar with the US dollar wiped out the value of pensions.
“The GNU undertook a currency reform exercise which killed the local currency and got it replaced by the US dollar in 2009. Pension schemes and insurance companies took advantage of the removal of the 25 zeroes from our currency to revalue pensions and insurance policy values,” stated Zvidzai.
He continued by referencing the findings of the Justice G. Smith Enquiry into pensions, which concluded that pensioners and policyholders suffered financial hardship. The Senator highlighted a government agreement to compensate civil service pensioners, with the expectation that NSSA and private insurance companies would follow suit.
“According to the finding of the Justice G. Smith Enquiry into pensions, pensioners and policy holders suffered heinous prejudice. Accordingly, Government agreed to work on compensating civil service pensioners while NSSA and private insurance companies would follow suit for contributors and policyholders under their respective purviews.
“The process of compensation was targeted to commence in earnest in all these sectors by March 2024. Hyperinflation is rearing its ugly head in our economy and will likely further prejudice compensates, and compensation disbursements are expected if the Government sticks to the promise that it made when we crafted the 2024 Budget,” Zvidzai said.
In his address to the President of the Senate, Zvidzai called upon the Minister of Finance Mthuli Ncube to make a statement regarding the progress of the pensioner and policyholder compensation plan. He emphasised the need for compensation to be paid in US dollars to protect against further losses due to inflation.
Zvidzai also urged for strict monitoring of insurance companies to ensure they distribute fair compensation.
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