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PPF strives to meet customers’ needs
2006-09-24 09:44:08
By Rayner Ngonji
The Parastatal Pension Fund (PPF) last week organised a one day seminar for 30 Dar es Salaam based journalists from different media houses to enlighten them on its activities.
Staff Writer Rayner Ngonji was among the participants and here he reports on what transpired at the seminar held in Bagamoyo.
PPF is perhaps the only local Fund that is attempting to serve its members and give them what they deserve by devising strategies that target the objectives it was established to meet.
This is what could be construed from the seminar when other funds are bent on quantity, theirs are on quality benefits.
The Fund’s Director General, William Erio says the idea behind the approach is to try to achieve the set goals in style and thereby satisfy the customers.
He says this explains why they have decided to operate with fewer benefits compared with other social security Funds to ensure that members are served in the real sense of service.
Presenting a paper at the seminar, Badru Msangi, who is the Fund’s Pension Services Director had this to say: ’’What we are doing is to ensure that our members at the end of the day get a good amount of money on retirement instead of just peanuts.’’
He cautioned that members should not be contended with
services, which at the end of the day, leave them empty handed but should target hefty payment on retirement.
One of the decisions reached is that of taking the responsibility of educating a deceased member’s children.
Badru Msangi, says the move was effected after learning that the deceased benefits meant for the purpose of educating the orphans usually ended up being hijacked by relatives.
’’We received a lot of complaints pertaining to the issue and upon investigation we established that the money was being used by relatives for other purposes instead of paying school or tuition fees for the children,’’ he asserted.
He cited an example where some heirs would come with documents purporting to show that they needed the money to transfer the children to other schools but once the funds are released, they don’t honour their promise.
However, Michael Mjinjwa, the Funds Commercial Services Director says the Fund is compelled to confront three challenges to revert the situation.
These are low level of social security awareness amongst the people, low level of income amongst employees and the tax perception amongst employers which are all believed to have adversely affected its operations over the years.
He says to overcome this, the concept of social security should be introduced in schools to create awareness amongst the youths on the importance and value for employees saving part of their earnings for the future however little they realise.
Some participants floated a proposal that since a Tanzanian’s life expectancy has dropped from 55 years to 41 because of the HIV/AIDS scourge, the management should think of reforming the directive to allow payments of the benefits earlier than is the case now.
’’Such practice stands a better chance of benefiting the members more than the present system,’’ echoed Augustine Sangi of New Habari Corporation.
They hold that by demanding that a member is liable for pension benefits only after attaining 60 years, deprives them of their right.
But Michael Mjinjwa PPF’s Director of Commercial services says principally the savings are not meant for them but their heirs especially children.
Attached to this was a proposal of changing the maturity age for respective benefits from between 10 and 15 years to fewer in view of the declining life expectancy as well so that recipients receive the benefits earlier enough.
Rashidi Kejo, Features Editor of Mtanzania was of the view that reduction of maturity age of the Fund’s contributions could serve better the Funds objectives which include relieving him of financial hurdles after retirement.
The Fund currently manages seven benefits for -old age, death, survivor, gratuity, disability, withdrawals and education as it was established for in 1978.
It strives to emphasise some uniformity and certainty in pensions and related benefits payable to employees of parastatal organisations in a situation where no regulatory machinery previously existed.
It was envisaged by the architects of the scheme that the standardisation of pension benefits payable to all parastatal employees would create a measure of administrative economy and simplicity apart from being egalitarian in its essence.
The establishment of the scheme at the time was opportune and necessary to cater for employees’ retirement benefits because up to that time, there was completely no pension arrangements for ordinary employees because the majority of the top executives of such companies were covered under other private or government pension schemes.
The other category of employees consisted of individuals who were too young to worry about retirement.
Since its establishment the National Insurance Corporation (NIC) of Tanzania Ltd was entrusted with the responsibility for the day to day administration of the fund and the scheme under the direction of the appointed Board of Trustees of the Fund who are responsible for the appointed Board of Trustees of the Fund who are responsible for the management and control of the Fund in accordance with the provisions of the act.
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