Gweru City Council says it is considering migrating to a cheaper pension scheme for its workers amid reports that the local authority owes $9 million to the Local Authorities Pension Fund (LAPF) in unremitted pension contributions.
BY Stephen Chadenga
Town clerk Elizabeth Gwatipedza said council was struggling to settle the debt due to financial constraints and that it was not sustainable to continue contributing to LAPF.
“We owe LAPF over $9 million and it’s not sustainable,” Gwatipedza said.
“There is need to migrate to cheaper pension schemes and I have since tasked someone to look into the issue. We just want to make sure we do not violate any laws as we look into other options.”
In 2013, LAPF took council’s now-defunct Go-Beer Breweries to court over an estimated $200 000 pension fund debt.
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It was discovered during that time that Go-Beer had not been remitting workers’ pension contributions since 2010.
Local authorities across the country owe the pension fund $167 million in outstanding contributions and interest with reports that the fund has had to deal with a number of litigations with former workers challenging their payouts.