PENSIONERS receiving regular payments from the Government Institutions Pension Fund (GIPF) increased to 46 931 last year.
According to the GIPF integrated annual report of 2021/2022, new pensioners receiving payments increased by 1 434 from 45 497
The increase saw GIPF paying out N$5,5 billion in benefits to members, up from N$5,2 billion in 2021, an increase of 7,5%, while pension contributions from contributing employers rose 1,2% to N$4,5 billion.
“The increase in benefit payments is mainly attributable to an increase of 1 434 newly retired members, (2021: 5 993) and an annual inflationary adjustment of 4,62% (2021: 3%) offered to pensioners,” GIPF said.
During the past year, the fund paid out 8 847 benefit claims, about 1 110 more than the previous financial year’s claims of 7 737.
This was mainly as a result of a 4% increase in monthly pension payouts, an increase of 1,8% on death benefits and an increase in funeral costs. Retirement (lumpsum) benefit claims reduced by 220 (from 3 197 to 2 977 in the previous financial year).
Meanwhile, GIPF recorded a 2 404 decline in active membership in the 2021/2022 financial year. The fund’s active members stood at 98 623 by the end of March 2022, down from the 101 027 recorded in the previous year.
According to GIPF spokesperson Edwin Tjiramba, the five-year consecutive decline was due to the fact that GIPF is a maturing fund.
“This depends on the number of members who retire, or it depends on whether the government is hiring enough workers,” GIPF spokesperson Edwin Tjiramba said.
In 2022, The Namibian reported that at least 52,5% of GIPF’s active members are aged over 50, and will retire in the next 10 years.
This reduction in active members has resulted in an increase in the fund’s benefits/contribution ratio from 116% in the past year to 123% ending March 2022. There is a longevity reserve of N$9,7 billion in place to cover members up until their death.
The fund’s expenditure as a percentage of pensionable remuneration membership increased to 1,63% as a result of increased resource allocation to information systems technology, employment costs primarily due to the expansion of the investment department and member outreach initiatives.
The fund incurred N$336,35 million as administration fees, up from the N$324,46 million in the previous year.
GIPF’s investment return has increased with 10,8% to N$13 billion, compared to an increase of 26% (N$27,9 billion) in the prior year.
“The increase is attributed mainly to favourable investment returns during the period under review,” GIPF reported.
Over the past nine years, the fund has managed to drastically increase its asset base. In 2013, GIPF’s assets were N$62,33 billion and in 2022, its asset base stood at N$147,04 billion.