THE NAPSA DILEMMA
Recent reports indicate that NAPSA, which traditionally has been a key participant in Government Bonds, has not participated in the last 2 or 3 Bank of Zambia Government Bond auctions. And NAPSA’s has greatly contributed to the recently heavily under subscribed auction.
How long is a piece of string? NAPSA, according to recent reports, has paid out K5.8 billion as part of Mr Hakainde Hichilema’s policy of partial pension withdrawals – of approximately $300 million using daily average exchange rates since this programme started.
We are also told that NAPSA expected a total partial pension payout totaling K11 billion to cover all potential partial pension draw downs. In effect, another K5.2 billion remains to be paid which is approximately $290 million. This translates to a cumulative payout of $590 million.
We are also told that NAPSA will provide debt financing to the tune of $300 million for the Lusaka/Ndola dual carriage.
In summary, NAPSA cash outflow on these two events in 2023 alone will be $890 million. This is a very huge amount! And we hope it will not create future funding constraints for NAPSA’s future operations.
As well meaning citizens, we strongly urge the Pensions and Insurance Authority to take keen interest in NAPSA’s future cash flow profiles for any potential risk of failure. We are not saying there will be a failure but just prudently ensuring that NAPSA can sustain these huge commitments.
Zambia defaulted on its Eurobond payments whose investors are mostly pensioners. And in our debt restructuring quest, we are appealing for a haircut on the Eurobond. Meaning the pensioners, whose hard earned money was invested in these Eurobonds will lose out. The same can happen to our pensioners who are contributing to NAPSA on a monthly basis should things go wrong. So NAPSA needs to be extremely cautious on its investment profiling to safeguard the interest of our workers at a point of retiring.
President of the Socialist Party