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Martin Tarusenga
In early July 2014, the Finance Minister announced to the nation that he would set up a Commission of Inquiry to establish whether insurance companies and related service providers entitled pensioners and other subscribers of pensions and insurance services, correct full rightful benefits.

The tone of the Terms of Reference for the Inquiry was proposed to all stakeholders for input, and in a stance which signalled his belief that pensioners and other subscribers were not entitled correctly as a consequence of loopholes in pension and insurance legislation. He immediately called for a stakeholder workshop to make submissions on improving such legislation. His primary objective in so engaging the Inquiry was pronounced as one to restore confidence in the pensions and insurance industries, thereby ‘reinstating’ the industries’ intermediation role to harness households disposable income into mainstream macroeconomic development via pensions/insurance products and services.

The Minister was publicly hailed and encouraged to expediently progress the Inquiry to restore domestic investor confidence in local investment markets such as the two industries, as this would in turn convince foreign investors that the Government is currently courting. The President would, in Parliament, confirm and reassert this Government strategy and fully compensate any prejudiced pensioners.

To date, the Minister’s office advises that the Inquiry Terms of Reference are in place, and that names of proposed Commissioners to the Inquiry have been submitted by all stakeholders, but five months down the line, the Minister’s office is not saying why the Inquiry has not begun. Pensioners who have anxiously been following up on progress have justifiably begun questioning the Minister’s sincerity in resolving the stand-off. Pensioners’ anxieties are especially heightened as they desperately depend on the pensions. Their conviction that insurance companies got it wrong, and/or are playing fraud are especially heightened and reasonably justifiable given the many public categorical submissions in this regard, and not least that none of the insurance companies have made categorical responses exonerating themselves from the indictments, five years since the stand-off became of public concern.

Pensioners and other subscribers reasonably expect the resolution of this crisis to have a definitive appropriate turnaround time like any project or service provision.

They further expect exacting delivery standards, and for the job holders to be pinned down to the turnaround times, and the service delivery standards. The business cultures of all progressive developed economies can be traced to setting up such turnaround times prior to execution, setting up of exacting delivery standards and pinning down executors to these standards in zero tolerance governance regimes.

While the Minister has done well to set the groundwork for the Inquiry, and for the review of legislation to start, public despondency reflecting in pensioner anxieties intimate that five or more months to set up a Commission of Inquiry may be deemed as inefficiency, considering pensioner desperation. Would-be pensioners and other subscribers, herein the domestic investors, are evaluating whether it is worth their while to make such long term investments if the Minister appears to be faltering in instituting this Inquiry on such public concerns in a closed-ended manner.

This public despondency may defeat the Minister’s very objective of instilling public confidence in the pensions and insurance industries, and in wooing foreign investors in the country. No doubt foreign investors will not have any confidence in Government policies and actions that suppress their own domestic investor.

The latter line of argument regarding the Minister’s apparent performance in resolving these public complaints against insurance companies and related service providers can potentially condemn the conduct of business in Zimbabwe, and to the detriment of the much needed domestic and foreign investment.

This occurs as the Finance Ministry’s policies and actions affect the financial system overall — covering among other things households decisions on savings (in this instance through pensions/insurance products), how efficiently insurance companies channel these savings to business start-ups (thereby creating employment), whether or not insurance companies treat the domestic investor fairly by channelling back investment returns from investments in the businesses.

The conduct of business in Zimbabwe could thus be condemned if, as is apparent Insurance and Pensions Commission (IPEC), as regulator, has not acted for 5 years, to stop the apparent fraudulent activities of insurance companies against pensioners, but continues to draw on salaries, and incur other running costs to the taxpayer (in the name of regulator), while the Minister (apparently) keeps a lid on the Commission of Inquiry.

It is advisable for the Minister to be demonstrably sensitive firstly to the pensioner’s desperate need for their pensions, and secondly to the macroeconomic call for domestic and foreign investment.

Opinions expressed herein are those of the author and do not represent those of the organisations that the author represents.

• Martin Tarusenga is General Manager of Zimbabwe Pensions & Insurance Rights, email, [email protected]; telephone; +263 (0)4 883057; Mobile; +263 (0)772 889 716