UNPACKING THE ESWATINI NATIONAL PENSIONS BILL,2025

 

Image Source: an image sourced online depicting a Pension Fund

Written by Fundizwi Sikhondze 

The Eswatini Government released a Government Gazette Extraordinary dated 10^th July 2025 which turned out to be the long awaited Eswatini National Pension Fund Bill 2025.

The Bill has been long awaited within the workers movement for several years as they have always campaigned for the conversion of the fund into a full pension, and in January 20205 the Eswatini Government cabinet had given a green light to the conversion of the Eswatini National Provident Fund (ENPF) into a pension. In their statement at the time they gave the Minister of Labour and Social Security the baton to ensure the achievement of the pension by introducing the necessary Bill in the legislature.  

It ought to be mentioned out rightly that the issuance of the Bill has not been received with equal excitement amongst workers particularly public service workers who have raised fears that the new Bill and if it is eventually transformed into an Act might disadvantage them in their current arrangement with their occupational (enterprise based) pension fund, the Public Service Pension Fund (PSPF).

According to the Financial Services Regulatory Authority (FSRA) website (www.fsra.co.sz) there are about 71 occupational and private retirement funds in Eswatini including four (4) the statutory retirement funds, the ENPF, the PSPF, the Members of Parliament and Designated Office Bearers Pensions Fund (MOPADO) - Defined Benefit (DB) and the Members of Parliament and Designated Office Bearers Pensions Fund (MOPADO) - Defined Contribution (DC).

The statutory retirement funds are those established through legislation whereas other retirement funds are those established by employers for their employees as well as private funds run by insurance companies and are run in accordance with the Retirements Funds Act (2024) as amended.

 

The Pensions Bill 2025 Contents

The Pensions Bill contains 12 parts (Part 1-12) and one hundred and ten (110) sections spread across the 12 parts. This overview will engage with details in sections that hold a high level of interest.

Part I of the Bills contains preliminary information such as definitions. Part II (s2) states that the fund is established as a Category A public enterprise under the Public Enterprise (Control and Monitoring) Act 1989 or its successor. Section 4 under the same part states that the fund shall be a Defined Benefit Fund. It may be prudent to add that the current ENPF- provident fund is a Defined Contribution scheme.

"Defined Contribution" means a contribution made either by an employer or an employee but the employee carries the investment risk and the benefits are paid based on the total contributions made plus interest or any surplus. 

“Defined Benefit” means a fund in which the individual member’s pension benefit is determined solely by reference to the contributions paid into the fund by or on behalf of that member and the investment return earned on those contributions.

www.fsra.co.sz

Part III, titled ‘Contribution or Membership to a Pension Fund’, deals with who are the expected members of the fund. S9 (1) states that, “An employer, employee, self-employed and other workers shall contribute to and be a member if the fund”. S9 (5) states that, “Notwithstanding subsection (1) an employer, employee, self-employed and other worker may contribute to and be a member of an occupational and private scheme or arrangement”.

Part IV titled, ‘The Board’ states that the board shall comprise of the Principal Secretary (PS) of Labour and Social Security as well as the PS Finance, two Employers representatives, two representatives from workers federations, one representative of retired members of the fund.one representative from self-employed or other workers, one representative from traditional institutions and the CEO of the institution. Section (11 [2]) states that the board period in office shall be three years.

Part VII titled, ‘Registration and Contributions’ in section 52 (1) basis for calculating contributions states that employer and employee contributions shall be calculated on the basis of the gross remuneration of the employee for the applicable pay period, as prescribed in the second schedule. Section 52 (3) states that the contributions payable by self-employed persons and other workers shall be calculated with reference to their earnings ,as prescribed by regulations.

Part VIII is titled Benefits in Section 66 (1) states that a person who is a member or a dependent of a member shall ,subject to meeting the eligibility criteria applicable to each category of benefits, be entitled to the following benefits – (a) retirement benefit , (b) invalibility benefit (c) survivors benefit and funeral benefit. Section 66 (2) states that the entitlement of a person to compensation or benefits arranged contractually ,privately or through an occupational scheme ,in respect of any contingency covered under subsection (1) where such compensation or benefits are based on supplementary and voluntary contributions to such schemes shall not be affected by the provisions in this act.  

One of the sections that has raised elicited concerns from sections of workers is Section 69 which deals with restrictions on double benefit. Section 69 (1) states that , “A beneficiary shall not be entitled to receive more than one (1) cash benefit paid in respect of the same contingency provided by the fund or any other contributory public scheme or arrangement”. Section 69 (2) states that, “Subject to subsection (1), the additional cash benefit funded from supplementary contributions, shall not be affected by the restriction on double benefit”. Section 69 (3) states that a beneficiary who qualifies for more than one cash benefit from a contributory public scheme or arrangement in respect of the same contingency which is not an additional cash benefit contemplated in subsection (2) shall be entitled to be paid the benefit which is the highest”. Section 69 (4) states that the provisions of section 54 are not affected by the provisions of this section. Lastly Section 69 (5) states as follows. “The benefits paid under this section shall have no bearing on the benefits provided by an occupational pension scheme”.

Section 90 to 92 of the Bill deals with survivor’s pension and the rights of dependents to the pension of their relative at rates that stand to be determined through actuarial formulas.

 Part XI (Transitional Provisions) and Section 104 deals with transition from the provident fund into the pension fund and provides that all current members of the ENPF provident fund will be deemed to be members of the ENPF pension fund at the time of the transition.

Section 107 is another part of the bill that has created widespread interest from workers subscribing to existing occupational schemes. On Saturday 02 August the Eswatini daily newspaper group the Times of Eswatini led with a story that the executive members of the PSPF had voiced resistance to public service workers join the ENPF. They cited this section and presenting fears that the way its presented can make the PSPF beneficiaries enjoy less benefits in the future.

S107 provides that those workers participating in existing pension schemes, provident funds and or occupational funds shall not be exempted from contributing to the ENPF (pension fund) in respect of such employees. Section 107 (3,b) provides that the bill should not be construed to require the contribution to an existing occupational scheme  and the ENPF pension fund an amount in excess of that paid by the employer to the scheme for any comparable period before becoming a contributing employer under this act.

OUTSTANDING LEGISLATION ACTION ON THE BILL

Now that the Bill has been introduced for the second reading in Parliament it is widely expected that it will go though the committee stage of the process where the Ministry of labour and Social Security Sub-Committee will go through the Bill. Then it will be open for comments and and amendments. After that it will go to the third reading and then will be taken to a vote in the house. The House of Senate will also process the bill and if they approve the bill it will be taken to the head of state for the final assent. This process may take a few months.