Former Finance and Economic Development Minister, Tendai Biti Tuesday 27 September 2022 claimed that “greedy” insurance companies like Old Mutual and First Mutual are yet to pay back the US$5,86 billion they took from Zimbabweans over ten years ago.
Speaking in Parliament Biti said the companies took advantage of inflation and weak regulatory framework by the Insurance Pension Commission of Zimbabwe (IPEC).
The law expert cited the Justice Smith Commission of Inquiry of March 2007 which recommended that insurance companies needed to compensate Zimbabweans for the US$5.86 billion which they had illegally converted for their benefit. He said:
My point of national interest relates to pensions. As you know, in March of 2007, the Justice Smith Commission of Inquiry into conversion of people’s pension funds presented its report.
That report made several recommendations after finding that Zimbabweans had lost pensions to the total value of USD5.86 billion as a result of a weak regulatory framework by IPEC, the Insurance Pension Commission of Zimbabwe, the scandalous and greedy behaviour of insurance houses and terrible macro-economic environment, including inflation that had risen to 500 billion percent.
So effectively, Justice Smith recommended that there be compensation for pensioners, teachers, headmasters and workers who had worked from 1980 and served through their pensions but their pensions were wiped out.
He said the recommendations have not yet been implemented.
Biti added that there is also a second group of pensioners who saved their money from 2009 when the economy had dollarized, and paid their pensions in USD, but “greedy pension houses like Old Mutual and First Mutual are now paying those pensioners in paltry ZW$.”
The Harare East legislator urged Finance Minister Mthuli Ncube to come up with a law that puts into effect the Justice Smith Commission of Inquiry recommendations.
Biti said he was one of the affected contributors. He took out an Old Mutual policy in 1994 with an assured sum of Z$50 million (about US$20 000 the exchange rate of the time), but to date, he has never received a cent.