Invest pensioners' cash in prudent undertakings

Minister of State in the Prime Minister’s Office (Policy, Parliamentary Affairs, Labour, Employment, Youth and the Disabled) Jenista Mhagama.

What you need to know:

  • This is exactly what is expected from a minister in a government geared at industrialisation of the country. It augurs well with Tanzania’s Development Vision 2025 which aims at turning ours into a middle-income and semi-industrialised one.

Minister of State in the Prime Minister’s Office (Policy, Parliamentary Affairs, Labour, Employment, Youth and the Disabled) Jenista Mhagama on Tuesday urged board of directors of pension funds to invest pensioners’ monies in industrial activities.

This is exactly what is expected from a minister in a government geared at industrialisation of the country. It augurs well with Tanzania’s Development Vision 2025 which aims at turning ours into a middle-income and semi-industrialised one.

We don’t expect opposition to this idea, especially at this period when the same has received a new push from President John Magufuli’s administration.

That said, we would advise the pension funds handlers to ensure they make a thorough analysis before arriving at the right industries in which they can invest.

At every point, the custodians of workers’ cash must recognise that the money is not theirs; it has to be available whenever the owners—currently the ones toiling for it in various economic undertakings—need it. Traditionally, social security funds have been investing pensioners’ monies in listed stocks, risk-free treasury bonds/bills and in the real estate and so far, things have been bright.

The industrial sector would therefore be a completely new investment avenue for pension funds. They would thus be required to learn from the reasons behind the collapse of some factories in the country so as to avoid a repeat of the same.

While reports on pension funds losing money due to poor investment avenues would be scanty in Tanzania, data from neighbouring countries show a somewhat different scenario.

In Kenya for instance, a report released by the country’s auditor general in June 2013—revealed that social security savers lost over Ksh3 billion (about Sh63 billion) in dubious contracts, land and share purchase deals.

This is why pension funds must invest in areas where security of the pensioners’ money can be guaranteed.

MINIMISE CERTIFICATE CRAZE

Following the recent directive by the Education ministry that employers should make an audit of their staff to weed out those who got jobs using forged certificates, many people who had for years been comfortable at their workplace are presently in a panic mode. More so those who, after acquiring a stolen, forged or borrowed certificate, settled into their fraudulently acquired jobs without bothering to go for some training.

People who have genuinely lost their certificates shouldn’t worry much, for their cases will be easy to verify since the National Examination Council of Tanzania (Necta), educational authorities from the district to the national level and training institutions, keep permanent records of all who pass through their hands. Woe unto those whose certificates are works of total forgery!

It is clear people crave for certificates because some employers demand them as a matter of course, even when a person can otherwise demonstrate he has what it takes to do a good job. Individuals who are practically hopeless get promoted while their peers with good expertise are side-lined only because they have no certificates to “prove” themselves.

While fraudsters should be unearthed and put on their defence, employers should be careful not to get rid of genuine talents and retain lazy and incompetent holders of colourful certificates.