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Reform of the Death Benefit Provisions in Lesotho's Public Sector Pension Fund: Lessons from South Africa and Swaziland

Reform of the Death Benefit Provisions in Lesotho's Public Sector Pension Fund: Lessons from... MTENDEWEKA MHANGO and NTOMBIZOZUKO DYANI-MHANGO I. INTRODUCTION In 2008 the Parliament of Lesotho enacted the Public Officers' Defined Contribution Pension Fund Act 8 of 2008 (hereafter referred to as the Public Officers' Pension Act) to reform the public officers' pension scheme. In his 2008 budget speech, which introduced these pension reforms, Lesotho's Minister of Finance and Development, Mr Timothy Thahane, announced that the government of the Kingdom of Lesotho would reform the unfunded defined benefit public sector pension scheme to specifically address two historical problems. He explained these problems and the need for the reforms as follows: Currently, the Government operates an unfunded pension scheme that promises a certain pension when a person retires. That pension will be paid from the recurrent budget of that year. There are two risks that surround our current pension system. If there happens to be unforeseen emergency demands on that year's budget, the Government of that day may suspend or reduce the pension, thereby causing undue hardship on the pensioner. Another feature of this scheme is that when the pensioner dies, the pension also ceases thereby leaving the spouse or the children without any benefit. The reform which Government is introducing is http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png African Journal of International and Comparative Law Edinburgh University Press

Reform of the Death Benefit Provisions in Lesotho's Public Sector Pension Fund: Lessons from South Africa and Swaziland

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Publisher
Edinburgh University Press
Copyright
© Edinburgh University Press 2016
Subject
Articles; African Studies
ISSN
0954-8890
eISSN
1755-1609
DOI
10.3366/ajicl.2016.0150
Publisher site
See Article on Publisher Site

Abstract

MTENDEWEKA MHANGO and NTOMBIZOZUKO DYANI-MHANGO I. INTRODUCTION In 2008 the Parliament of Lesotho enacted the Public Officers' Defined Contribution Pension Fund Act 8 of 2008 (hereafter referred to as the Public Officers' Pension Act) to reform the public officers' pension scheme. In his 2008 budget speech, which introduced these pension reforms, Lesotho's Minister of Finance and Development, Mr Timothy Thahane, announced that the government of the Kingdom of Lesotho would reform the unfunded defined benefit public sector pension scheme to specifically address two historical problems. He explained these problems and the need for the reforms as follows: Currently, the Government operates an unfunded pension scheme that promises a certain pension when a person retires. That pension will be paid from the recurrent budget of that year. There are two risks that surround our current pension system. If there happens to be unforeseen emergency demands on that year's budget, the Government of that day may suspend or reduce the pension, thereby causing undue hardship on the pensioner. Another feature of this scheme is that when the pensioner dies, the pension also ceases thereby leaving the spouse or the children without any benefit. The reform which Government is introducing is

Journal

African Journal of International and Comparative LawEdinburgh University Press

Published: May 1, 2016

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