Over 20,000 Mining Employees Miss Out on NAPSA’s Benefits in Zambia
Successive Zambian government has awarded tax and non-tax incentives to large-scale mining companies resulting in over 20,000 employees and ex-employees of Konkola Copper Mines (KCM) and Mopani Copper Mines (MCM) missing out on the National Pension Scheme Authority (NAPSA) partial withdrawal benefits even after working for over a decade for the two mining houses.
Although the National Pension Scheme Amendment Bill 2023 has been signed into law, allowing for the partial withdrawal of pensions, about 12,000 KCM employees and ex-employees and over 10,000 Mopani employees and ex-employees do not qualify for NAPSA partial withdrawal at 20 percent of the retirement benefits.
The President of Zambia, Hakainde Hichilema, announced the signing of the National Pension Scheme Amendment Bill 2023 on April 17, 2023.
This new law is expected to allow citizens to re-invest the funds into various ventures and assets of their choice, injecting liquidity into the economy, creating more jobs, and contributing to the national economic development agenda.
About 22,000 KCM and MCM employees will miss out on cashing out their pre-retirement lump sum benefit due to waivers that were given to these large-scale copper mines.
The National Union of Miners and Allied Workers (NUMAW) president, Saul Simujika, confirmed that KCM and MCM had a waiver for remitting NAPSA from 2004, which means they were not remitting both employer and employee contributions. As a result, people were not getting any deductions, and they cannot claim for their benefits.
Simujika added that the two mines were not breaking the law as they were given the waiver by the government. However, after somewhere in 2014 when the two mines resumed the contributions, people started receiving deductions. Those still in employment qualify for the benefit after the contribution was reversed, but most of those affected have retired.
It is worth noting that there have been documented historical misdeeds by both Vedanta and Glencore to local suppliers and employees, with accusations of arm-twisting government officials and not paying taxes. Reports indicate that these same firms are plotting a return to Zambia after being exited, and this NAPSA issue is just one of the glaring examples of misdeeds.
