Workers push for law review for early access to pension

Sunday October 29 2017

A textile factory.

A textile factory. Workers’ umbrella body — Congress for Labour Fraternity in Rwanda — argues that most employees in blue collar jobs do not reach retirement age while still in employment due to occupational hazard. PHOTO | CYRIL NDEGEYA 

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The Congress for Labour Fraternity in Rwanda is proposing review of pension law which if adopted could see workers who opt for early retirement access their pension before the mandatory age of 60.

Cotraf argues that it is necessary to have special consideration for people engaged in hard labour, but are forced to opt for early retirement because of the impact of their occupation on their physical health.

Rwanda has reviewed the retirement age from 55 to 60 years.

Cotraf noted that retirement at 60 is only tenable for white collar workers but a burden to blue collar workers, some of whom never live to 60 years because of occupational hazards. The labour federation cited workers in the mining and construction industries as potential beneficiaries from the proposals.

“I quit employment at 56 years due to health-related issues. It has been a difficult four years as I waited to qualify for pension,” lamented Felix Nzabahimana.

Retirees who save for more than three years with the national pension scheme run by the Rwanda Social Security Board RSSB, are entitled to a stipend based on their savings plus medical insurance for the remainder of their lives.

Families of those that die prior to retirement get survivors benefits.

But besides complaints about the monthly pension which has been eroded by inflation, workers in physically demanding occupations argue that they may never live to enjoy their savings while they face many years without social protection if they did.

“Very few people reach 60 years while in a physical state that allows them to engage in economic activity and those are mostly desk workers. How many construction workers can get to that age while still productive?” posed Nzabahimana.

Cotraf recently appealed to RSSB to re-examine the retirement age by matching it to occupations. Cotraf said the current retirement age only favours the pension fund and not workers, since most of them retire early under physical duress.

“The current retirement age is not fair. Since different careers demands different levels of physical exertion that should be reflected in the age they can retire,” says Cotraf president Dominique Bicamumpaka Bicamumpaka.

Permanent disability

Referring to the National Institute of Statistics of Rwanda data, which put life expectancy in Rwanda at 66 years for 2017, pensioners said even those who make the retirement age would enjoy their savings for a short time.

Currently, only workers who suffer permanent disability can access pension before 60 while servicemen in the armed forces can retire at 45 years.

Mr Bicamumpaka said despite ill health, many workers are forced to soldier at their workplaces, for fear of loss of a livelihood.

“Many workers outside there are waiting for five to 10 years after leaving their work to be admitted to the pension scheme,” he added.

Speaking to Rwanda Broadcasting Agency earlier, Oswald Munyandekwe, the director for pensions and occupational hazards at RSSB, said the board had submitted to the Cabinet proposals for reform that will meet workers concerns some way.

 “We made the proposals after realising that some of our subscribers were waiting for long a time to be admitted to the annuities, especially those that suffer abrupt loss of employment, yet they could have been making contributions for 25 up to 30 years,” Mr Munyandekwe said.

He also dismissed claims that the board was overleveraged and short of money to meet its obligations to pensioners because it is had invested a lot long-term projects.
On average, RSSB collects Rwf70 billion annually, and pays out around Rwf18 billion yearly.