Shiimi urged to scrap controversial FIMA clause

Republican Party (RP) lawmaker Mathias Mbundu says finance minister Ipumbu Shiimi must do away with the Financial Institutions Markets Act (FIMA) clause around pension preservation, and clarify its constitutionality. If implemented, the clause will make it compulsory for pension funds to retain 75% of the capital invested, while paying only 25% to beneficiaries upon retirement, resignation or retrenchment before the age of 55.In a motivation in the National Assembly, Mbundu implored Shiimi to put the clause on hold. “There is a great need for the separation of the controversial pension-preservation clause from FIMA. The minister must put on hold all controversial clauses when implementing FIMA,” he said. Mbundu also asked that the finance ministry and the attorney-general clarify whether there is a constitutional requirement to incorporating the controversial regulations into law. “The ministry must consider the concerns and challenges stated by the stakeholders,” he added. Revise the ActMbundu also called for the revision of the Pension Fund Act, which was enacted in 1956. “The outdated Pension Fund Act should be revised since it no longer suits the current economic situation,” he said. The lawmaker also implored non-banking financial institutions regulator, the Namibia Financial Institutions Supervisory Authority (Namfisa), to conduct annual consultations with Parliamentary Standing Committee on Economics and Public Administration.“Namfisa should hold annual briefings and consultations with the National Assembly through its Parliamentary Standing Committee on Economics and Public Administration with the view to update members on developments in the non-banking financial institutions sector and to ensure that members are equipped with the necessary information.” The Government Institutions Pension Fund (GIPF) in 2022 expressed concern that there had been a worrying trend where pension pay-outs were being depleted “at an alarming rate”.“There are cases where we have cashed out millions to a single member. Believe me, it looks a lot, those zeros are very impressive; but as fast as it comes [is] as fast as it goes,” then-CEO David Nuyoma cautioned.He added: “There are some members who have elected to resign before they could retire and cash out, irrespective of even the heavy tax burden or penalties that will come. We have seen [this] time and again... and there is an average pattern of [the] time it [the money] lasts - plus minus 18 months”.The pension-preservation clause was initially planned to take effect on 1 October 2022, but has been postponed pending further public consultation.

Shiimi urged to scrap controversial FIMA clause

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Namibian Sun 2025-06-18

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Shiimi urged to scrap controversial FIMA clause

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Namibian Sun 2025-06-18

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