26 pension funds dissolve in 2019
HARARE, Financial challenges prevailing in the country has seen 26 pension funds undergoing dissolution in 2019 with four dissolution’s having already been finalized.
Naturally, the performance of the insurance and pensions industry follows the fortunes of the economy and Zimbabwe has going through plethora of challenges ranging from foreign currency shortages, lack of fresh lines of credit, low production and diminishing disposable incomes among others.
This has forced some companies to close down, taking toll on the pensions ion funds.
Available information shows that as of February 2019 over 50 companies have been liquidated since November 2017.
The Insurance and Pensions Commission (Ipec), in its annual report noted that the dissolution’s were necessitated by financial challenges faced by the sponsoring employers, some of whom had closed down.
“A total of 26 funds were undergoing dissolution in 2019. Of the 26 cases, four dissolution’s were finalized,” it noted.
Ipec said the challenges stalling finalization of the outstanding dissolution process included absence of records from sponsoring Employers, Problems locating members and hence challenges in reconstitution of board of trustees or committees to oversee the dissolution process.
Lack of adequate resources to pay liquidators is also among challenges impacting finalization of outstanding dissolution’s.