The Department of Social Security derives its mandate from the Government Gazette Notice Number 46 of January 24, 1992, which directed that the Ministry of Labour and Social Security would be responsible for matters pertaining to Social Security. Arising from this mandate, the Department was established to perform functions related to policy formulation, monitoring and evaluation, research development of social security standards and the promotion of social security awareness.
The legal framework for terminal, retirement and pension benefits in Zambia is specifically governed by the following pieces of legislation:
The Social Security landscape in Zambia is predominantly of a social insurance model limited to the provision of protection against loss or reduction of income resulting from retirement, disability and survivorship. This coverage, however, is limited to the formal sector. There are basically 5 Statutory Schemes:
The contributions in these schemes is generally from both the employer and the employee. However, the Workers compensation fund control board contributions is entirely on the employer
Other Institutions collaborating with the department include: Ministry of Finance and National Planning, Ministry of Local Government and Housing, Ministry of Community Development and Social Services, Ministry of Health, Ministry of Justice, Mukuba Pension Trustee Limited and Private Occupational Pension Schemes.
The Public Service Pensions Fund (PSPF)
The Public Service Pensions Fund was established as a defined benefit scheme in 1997 through an Act of Parliament with the intention to consolidate the law relating to pensions and other benefits for persons employed in the public service. Prior to 1997, pension benefits for public service employees were handled by the Civil Service (Local Conditions) Pensions Board that came into operation in 1968. The Fund covers employees in the public service prior to 1 February 2000, including the teaching service and defence forces. The Fund is designed to provide income security in the event of retirement, permanent invalidity and survivorship. Apart from paying pensions and gratuity (lump sums) to retirees, the Fund acts as a paying agent for the government with regard to death and early retirement cases. The Fund thus relies entirely on the government to clear the latter. The Public Service Pension Act No.35 of 1996 governs the Public Service Pension Fund.
National Pension Scheme Authority (NAPSA)
The National Pension Scheme Authority was established by an Act of Parliament in 1996, to replace the Zambia National Provident Fund, which had revealed a multitude of weaknesses ranging from low contributions and inadequate benefits to an inappropriate structural design. The National Pension Scheme became operational on 1st February 2000. The scheme aims at affording the workers protection from social hazards by providing them with benefits at the time of retirement to provide income in old age, assist the worker with a benefit in the event of physical or mental disability due to permanent illness or mental disturbances which may deny regular employment. The National Pension Scheme (NPS) Act of 1996 governs the National Pension Scheme Authority.
Local Authorities Superannuation Fund (LASF)
The Local Authorities Superannuation Fund was created under the Government Notice No.314 of 1954 and thus it covers employees of the local authorities prior to 1st February 2000. The Fund is designed to provide income security in the event of retirement, permanent invalidity and survivorship. The Local Authorities Superannuation Fund CAP 284 of the Laws of Zambia governs the operations of the Local Authorities Superannuation Fund
Workers Compensation Fund Control Board (WCFCB)
The Workers Compensation Fund Control Board provides employment injury protection to all private and public sector workers except permanent civil servants, teachers, police and the armed forces. The rates of contributions to the fund vary according to industries. The fund caters for pension benefits, the survivors’ benefits paid to widows and guardians, temporal periodic payments are made to individuals as they undergo treatment. The Workers Compensation Act No. 10 of 1999 governs the Workers Compensation Fund Control Board.
Pensions and Insurance Authority (PIA)
The Pensions and Insurance Authority is the regulatory and supervisory authority for the pensions and insurance industry in Zambia. It is created by the Pensions Scheme regulation Act No. 28 of 1996 (as amended by Act No. 27 of 2005). Prior to the enactment of Act No. 27 of 2005 the Pensions and Insurance Authority existed as the office of the registrar of pension and insurance under the Ministry of Finance and National Planning. Following the Act No. 27 of 2005, the Authority became a body corporate.
Occupation Pension Schemes
These are private schemes established by the employers to cater for pension and other types of insurance. These schemes, however, are different from other schemes in that they are not mandatory; employers are not compelled by law to set up a pension scheme for their employees.