Republic of Zambia
Ministry of Labour and Social Security
Press Statement (For Immediate Release)
PRESIDENT HICHILEMA SIGNS HISTORIC NAPSA REFORMS, PLACES DIGNITY, SECURITY AND PROTECTION AT THE HEART OF RETIREMENT
Lusaka, Zambia, 4th June 2026 – President Hakainde Hichilema has assented to the National Pension Scheme (Amendment) Bill, No. 68 of 2026, which provides for the introduction of structured and regulated lump-sum access, allowing NAPSA contributors to withdraw part of their benefits before or at retirement under clear rules and safeguards.
At the same time, the reform maintains the core principle of ensuring lifelong monthly pension payments.
The law has repealed and replaced the National Pension Scheme Act of 1996, and will introduce improved governance structures, stronger compliance measures, expanded coverage, and better benefit administration. It will also render the pension scheme more adequate, inclusive, sustainable and responsive to changing labour market realities and socio-economic conditions.
Bill No. 68 of 2026 is aimed at modernising the legal framework governing the National Pension Scheme Authority (NAPSA) to make it more adequate, inclusive, well-governed and sustainable.
Compliance will be improved and pension coverage will be expanded through the introduction of sub-schemes aimed at accommodating emerging market needs. Rules on contributions and remittances will be tightened to protect workers’ savings and promote fairness among employers.
The new law also creates structured options for contributors to access part of their benefits in lump sums without undermining the social insurance character of the scheme.
Government had recognised the growing demand from contributors seeking greater flexibility as they approach retirement, hence the law will allow limited and orderly lump-sum access under clearly defined rules and safeguards, while preserving the core function of the pension scheme of providing monthly income security for retirees.
Among the key reforms contained in the new law is the increase in the pension accrual rate from 1.33 percent to 1.5 percent. This adjustment raises the income replacement rate from 40 percent to 45 percent, enabling retirees to receive higher monthly pension benefits and enjoy improved financial security in old age.
The law also increases the minimum pension from the current 20 percent to 25 percent of the National Average Earnings. As a result, the minimum pension will rise from K1,708 to K2,135, providing greater protection to low-income pensioners and helping reduce vulnerability among retirees.
In a landmark development, the law also introduces a Survivors’ Pension to replace the current one-off payment made to beneficiaries of members who have contributed to the Scheme for at least fifteen years but die before attaining pensionable age. This provision aligns Zambia’s pension system with the International Labour Organization Convention No. 102 on minimum standards of social security and guarantees continued financial support to surviving dependants.
The new law further allows members to access the Pre-Retirement Benefit at retirement as a lump sum, providing retirees with greater flexibility in managing their financial needs upon exiting active employment.
Additionally, the reforms introduce supplementary savings and diaspora pension schemes aimed at expanding retirement savings opportunities for Zambians living and working abroad, while strengthening financial inclusion and long-term savings.
The law also paves the way for the introduction of mandatory second Tier occupational pension schemes under the Public Service Pension Fund and the Local Authorities Superannuation Fund, thereby enhancing retirement income security for public sector workers.
The reform expands the range of benefits available under NAPSA, which now include Old age benefits, Invalidity benefits, Survivors’ beneits, Partial benefits, Funeral Grants and Voluntary Savings benefits.
Furthermore, the reform contributes to the implementation of the Eighth National Development Plan through the creation and strengthening of occupational pension schemes for public sector workers.
Issued By:
(Original copy signed)
Mwaka Ndawa (MS)
Principal Public Relations Officer
Ministry of Labour and Social Security
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