Over 50% of pensioners get less that Rwf30,000 monthly benefits. This is the minimum amount required to support basic needs.
Dorothée Uwimana, President of Pensioners’ Association, said while speaking to The New Times on Thursday, August 11 about pensioners’ living conditions and the need to increase their monthly benefits to be able to afford the basic standard of living.
According to her, many pensioners with less than Rwf30,000 can’t afford basic needs because of the current price rise.
“The study we carried out in 2017 suggested that the minimum pension benefits should be Rwf37,000 for a retiree in rural areas, and Rwf80,000 in urban areas,” she said, explaining that it was based on the differences in living conditions in rural and urban areas.
“It would be better if pension is adjusted with the increase in the cost of living in order to support retirees’ purchasing power, if possible,” Uwimana said.
During the Senate’s Plenary Sitting on Wednesday, August 10, that approved Regis Rugemanshuro, and Louise Kanyonga, respectively as the CEO and Deputy CEO of the Rwanda Social Security Board (RSSB), some senators advocated for Rent increase in response to the rising cost of living.
Senator Emmanuel Havugimana claimed that some retirees are unhappy with the small pension that they receive. He suggested that benefits that are in line with current living costs be made available to help change this.
Senator Jean Pierre Dusingizemungu observed that the declining value of the Rwandan franc is also one of the factors that weaken the retirees’ purchasing power.
“If they continue to get such little money that is not corresponding to the prices at the market, I think that the fundamental principles [that the Senate has to ensure are applied] would be somehow disregarded,” he said.
“Those people worked for the country for many years, so they should not be living miserably during retirement,” he pointed out.
In the meantime, Senator Adrie Uhire, Chairperson for the Committee on Social Affairs and Human Rights, stated that the RSSB acknowledged the issue of pensions affecting retirees.
She said that the institution had told the committee that it had conducted a study to determine how the pension could be increased without destabilising its fund.
The 2015 law governing the organisation of pension schemes in Rwanda provides that a public entity in charge of the pension scheme shall carry out an actuarial study for the pension scheme at least once every five years.
If the actuarial study indicates a potential negative impact on the economy, the amount Contributions shall be increased based on the legal provisions.
Based on the results from the actuarial study Pension benefits could also be increasedThe law provides for this.
In 2018, the most recent pension increase was made. It increased the minimum pension by more than doubling it to Rw13,000 (from Rwf5,200).
Speaking to The New Times, Louise Kanyonga, Deputy CEO of RSSB said that the Rwf13,000 was established as a minimum pension in order to improve the situation, “because before there were people who were even getting lower than that.”
“Inflation is a challenge at the moment. At RSSB, we are always looking at how we continuously improve our members’ welfare and secure their future, we are balancing that with ensuring that the scheme is sustainable as well,” she observed.
A glance at the public pension scheme
According to the March 2022 monetary policy statement published by the National Bank of Rwanda, assets of the RSSB managed pension fund grew Rwf227.7billion, or 23 percent, from Rwf985.6billion in December 2020 to Rwf1,213billion in December 2021.
Contributions increased by 17% during the period under consideration, from Rwf50.7 trillion to Rwf59.7 miliarde.
The report indicated that benefits received continued to increase, but at a slower rate then contributions.
Due to the increase in beneficiaries, pension fund benefit payments rose by 13 percent to Rwf17.3 million in 2021 during the period under review. In December 2021, 77% of total benefits payments went to pensioners (retirees).
The number of contributors to public pension was over 587,400 as of December 2021, while the number of its beneficiaries was over 45,500 in the same period.
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Source: rnewtimes
