SSRA ready to listen to stakeholders on pensions

Friday December 7 2018

SSRA Director General Irene Isaka. Photo |File

SSRA Director General Irene Isaka. Photo |File 

By Louis Kolumbia @Collouis1999

Dar es Salaam. The Social Security Regulatory Authority (SSRA) says it is ready to listen to stakeholders’ views with regard to the new formula for calculating retirees’ benefits provided they follow proper channels.

This comes a day after the Trade Union Congress of Tanzania (Tucta) issued its stand on the new pension regulations, which have drawn criticism from various quarters. Tucta told the press on Wednesday that it had no objection to the government’s decision to merge pension funds, but was against the new regulations, which have introduced a new formula for calculating pensioners’ benefits.

Speaking in an exclusive interview with The Citizen, SSRA director general Irene Isaka said the authority would consider stakeholders’ recommendations if they were channelled through the Minister of State in the Prime Minister’s Office responsible for Labour.

“Actuarial valuation of the pension funds will be conducted to determine whether it is possible to change the formula or not, and that will only be done if the government tells us to do so,” said Ms Isaka.

Under the new formula, pensioners will now receive only 25 per cent of their savings in lump sum, while the remaining 75 per cent will be paid in monthly instalments. Under the old system, pensioners who were under the Government Employees Pension Fund, Public Service Pension Fund and Local Authority Pension Fund (LAPF) received 50 per cent of their savings in lump sum and the remaining 50 per cent in instalments.

Tucta president Tumaini Nyamhokya said they would seek audience with the relevant minister and try to convince the government to review the formula so that pensioners could get at least 40 per cent of their benefits in lump sum.


Ms Isaka insisted that the formula for calculating pensioners’ benefits has been in place since 2014. The formula was introduced in order to harmonise pension benefits for workers in the private and public sectors.

“It wasn’t fair that public servants contributed only five per cent of their earnings and the remaining was contributed by the government, while those from the private sector contributed ten per cent and their employers contributed another ten per cent. That is another reason for the introduction of the new formula,” she said.

Reached for comment, the Speaker of the National Assembly, Mr Job Ndugai, who had previously distanced Parliament from the issue said, “The government and Tucta are the ones who are handling the matter.”

Pressure has been mounting on the government to review the formula for calculating retirees’ benefits.

Shadow Minister for Labour, Youth and Employment Ester Bulaya (Chadema) said on Tuesday that she would table a private motion in Parliament if the government sticks to its guns.

The ACT-Wazalendo Elders Council urged the government to continue paying retirement benefits using the old formula.

The Higher Education Workers Trade Union (THTU) also raised similar concerns recently.

THTU said the controversy surrounding the pension payment formula should be addressed as a matter of urgency.