Employers have rejected a proposal to increase the percentage of pension funds that one can receive after retirement from 40 percent to 70 percent.
The stand by George Khakhi, Executive director for Employers Consultative Association of Malawi – comes as Members of Parliament – last week agreed to table a private members bill on the amendment of the Pensions Act.
If amended, employees would be accessing their pension immediately after contract termination or retirement.
Employees will also be able to access pension package upon retirement, even before reaching the age of 60, and also that the pension package should be accessed if the employee has five years or less to retirement.
In addition, the amendment seeks to increase the payout by the pension administrator upon retirement from the current 40 percent to 70 percent.
Speaking to MIJ Online, Khakhi said if the proposal to increase the payout by the pension administrator is accepted- it will kill the aim of the pension fund- which is to ensure that employees have adequate income throughout their life span.
With this Khakhi- said association has also written the ministry of justice- ministry of finance and speaker of parliament to protest against the proposed amendment.