THE CASE OF PLUNDERED PENSIONS MONEY AT NAPSA
By Shalala Oliver Sepiso
THE PROBLEM AT HAND
As a proud praise singer and one who believes in President Hakainde Hichilema, the UPND and indeed a developed, free and great Zambia, it is my duty to sometimes steer up debates that will help our country move “forward”. Such debates will sometimes be uncomfortable but they have to be had otherwise the rot which was in PF era will take root in the UPND era and our country will lose a trick and a chance to correct things.
Today we talk about the pensioners’ money at NAPSA. This money is people’s pensions. This is poor workers’ money. But it is being lavishly, extravagantly and selfishly used by NAPSA officials while the owners of the money are languishing in poverty and waiting to reach 55 years to access their money.
Over the years, NAPSA has built shopping malls and hotels at astronomical costs. These deals were terrible. These buildings and shopping malls have poor occupancy rates and they provide no rates of return whatsoever as they are over-priced. NAPSA was ripped off.
As things stand, the painful truth is that after many years of scheming, the NAPSA money has been plundered. It is gone. The plunder of NAPSA runs into billions of Kwacha. Hundreds of millions of dollars have been plundered.
As a result, the workers who are making pensions contributions are not going to get reasonable benefits when they retire.
Where are the actuarial reports that must be prepared by independent people and they must be made public? We need to understand the depth of the rot.
The tragedy is that everyone is quiet. No one is talking about this whether they are PF or UPND or just business people. Everybody is hiding. Everyone who is supposed to care is not showing that care. Everyone who is supposed to act is not acting. People want to pretend there is no problem at NAPSA.
To demonstrate how bad NAPSA is, I have made the following calculation for a worker earning K5,000 per month.
1. The monthly contribution to NAPSA is K500. That is 10% of his salary.
2. Government securities such as bonds pay interest of about 20-25% per year.
3. If the person’s contribution was invested by NAPSA in government securities at the rate of 20% interest income per year, after 20 years, the pensioner would have a lump-sum pay out of about K1.1m
But the the actual payouts are nothing like this as the money has been plundered. I am hoping it is not currently being plundered too. The pensioners have been robbed over the years. The pensioners should be angry about what has happened. They have been cheated.
THE PAST SCANDALS
NAPSA has been embroiled in several scandals including purchase of defunct companies, unprofitable ventures and outrageously over-priced land. Lets address aa few examples.
In 2019, five NAPSA Directors were fired for attempting to individually buy pieces of land from the Baobab land, also known as Farm 4300. At that same time, NAPSA was negotiating to purchase the same land at $30 million, using a special purpose vehicle known as Flames Investment Limited. NAPSA wanted to construct a housing complex and a shopping mall. The price was way above the land’s market price of about $2 million. The five Directors were soon afterwards reinstated quietly after they threatened to take the matter to court for unlawful dismissal. The controversial Baobab land is said to have been eventually bought at US$27m. A legal person was even jailed for two years over the NAPSA Baobab land scandal.
Also in 2019, a NAPSA evaluation committee for the Twin Palm-proposed River View Park Infrastructure Development project recommended the awarding of a construction tender to AVIC International Zambia Limited at a bid sum of US $25.8 million against the construction company’s willingness to do the work for US $21.63 million! The decision was despite the quantity surveyor engaged advising that the AVIC international’s bid was unrealistic and would also take a longer completion period compared to other bidders. At that time, Hon. Charles Milupi said that it didn’t make sense because it was not the job of the evaluation committee to advise a bidder to increase the cost for the contract so that you can then select the company, like the NAPSA officials did for AVIC International.
In 2020, National Democratic Congress leader Chishimba Kambwili said the intended purchase of Chrismar Hotel by NAPSA at US$18 million was scandalous as the value of the said property had been exaggerated. According to The Mast newspaper, the National Pensions Scheme Authority was negotiating the purchase of Chrismar Hotel, along Los Angeles Boulevard road in Lusaka with its owner Valden Findlay, an associate of then president, Edgar Lungu. The paper said that Findlay had pegged the hotel at US$18 million, which was deemed to be higher than the actual value at which the property ought to have been sold. Kambwili said: “There is absolutely nothing wrong in NAPSA investing in infrastructure in hotels and in any other business so that they can raise money to pay the pensioners when the time comes but in doing that the law was very clear that NAPSA must stick to the norms that whatever investment they take their money into must benefit the pensioners.”
MAPSA was made to buy Freedom Park Shopping Mall in Kitwe at US33million even when this is not profitable for the pensioners but because some people greatly benefitted from this scandal. The Mall was even named after Edgar Lungu.
Despite the above, NAPSA continued making what many thought were “bad investments”. For example, alongside Industrial Development Corporation (IDC) and the Workers Compensation Fund Control Board (WCFCB), in Janauary 2021, information leaked out that NAPSA paid US$44.8 million to acquire 49 per cent shares in a private Chinese company that makes tiles called Marcopolo, under the Wonderful Group of Companies. It was alleged by the media that the $44.8m was deposited into accounts of two Chinese directors, Huang Yaochi and Zhang Lingling. The media alleged further that a month after the transactions, documents at PACRA didn’t reflect ownership of shares by IDC, NAPSA and WCFCB. However, it was said that K10m was deposited from the account of one of the Chinese directors to 3 IDC directors and other transactions from the bank accounts of the Chinese directors show huge deposits into accounts of PF officials.
In the same 2021, the Auditor Generals report revealed that NAPSA spent K23m to purchase 28 vehicles on a personal-to-holder basis contrary to provided guidelines. This means 1 vehicle cost more than K800,000.
There were even smaller scandals such us one where PF cadres allegedly occupied its NAPSA Houses without paying rentals. It was alleged that several Patriotic Front cadres occupied some NAPSA Flats in Woodlands Extension off Buluwe Road but never paid rentals. Some of the said cadres even leased out the flats to some students from Texila American University, which was situated nearby. One of the PF cadres who were staying here until after the UPND Alliance won the elections was named Charity. Such abuse deny workers their pensions.
Notice that we have not even addressed the scandalous Society Building, Levy Junction Mall, which was even downgraded from its original design. The scandals at these are such that if full figures were to be released and disclosed, they would shake the public.
We have not also looked at how NAPSA corruptly awarded Wah Kong and Golden Horse, both of China, to build houses in Solwezi, Muchinga and Luapula Province. The scandals are endless.
WHAT NEEDS ATTENTION AND ADDRESSING
The first and most shocking thing about NAPSA is that it is totally unregulated. NAPSA is not regulated by anybody. It does not fall under the Pensions and Insurance Authority (PIA) nor the Bank of Zambia (BOZ). This is absolutely wrong as it means it can carry out any transaction it wants without oversight. NAPSA falls under the Ministry of Labour. The PF government resisted all attempts to get it regulated so it could be plundered. Surely this has to change and it must be regulated by BOZ. NAPSA is the largest financial institution in Zambia. Why should they not be regulated?
Due to non-regulation, there was a time when the PF government was said to be misdirecting workers’ pension money at NAPSA to pay civil servants’ salaries and arrears. This was at a time when the PF are said to have depleted national reserves and the treasury was virtually empty. The PF government had also over-borrowed, over-spent and had run out of money to service both external and internal debt-obligations, as well as to provide for recurring government expenditure – the largest being salaries which gobble 60% of the budget! What the PF government was doing was basically stealing from workers’ future pension earnings to pay the same workers their salaries in the present day. The plan was to hide this and hope Zambians were dumb enough not to figure out or care about the implications of these actions.
The Minister of Labour must be taken to task over this non-regulation. She must insist that NAPSA starts being regulated to protect the pensions of the workers. Laws must be changed so that there is less chance of political interference under UPND unless the way it was under PF.
Talking of political interference, this has been rife with NAPSA. Political instructions have seen individuals getting loans from NAPSA with no proper collateral or security. Again this is wrong!
If we do not act now, people will not get their pensions.
