Mbabane – The conversation surrounding the proposed conversion of the Eswatini National Provident Fund (ENPF) into a national pension scheme has captured the full attention of the nation. From workplaces and bus ranks to WhatsApp groups and church gatherings, emaSwati are vigorously discussing the future of retirement security in the country.
As the debate intensifies, Likhweti, a weekly column authored by ENPF Conversion Specialist Miccah Nkabinde, has emerged as a key source of clarity. Nkabinde expressed gratitude for the engagement and feedback from the public, noting that while the responses have been varied, they are crucial to strengthening national dialogue. “Your feedback has been a mixed bag, but it is the kind of mixed bag that strengthens national dialogue,” Nkabinde said.
One of the column’s readers, Mnelisi Mndzebele, praised the initiative, describing it as timely and helpful in clarifying the confusion surrounding the proposed conversion. “Thank you for the clarification as well as the Likhweti initiative. Many people are perplexed about the conversion, so this column will absolutely help the multitudes,” Mndzebele wrote. This sentiment resonates widely, with many workers and employers admitting that the idea of moving from a lump-sum payout model to a lifelong pension system was initially daunting. However, Nkabinde’s column and public discussions are reshaping understanding and providing the necessary clarity.
Among the supporters of the pension reform is Samkelisiwe Shongwe, who passionately expressed concerns about the dangers of lump-sum payouts. “Educate and mobilise until we are all on board,” Shongwe wrote. “Imagine being broke after three months and the lump sum was between E200,000 and E500,000.” Shongwe’s point highlights a real issue—across Eswatini and in neighboring countries, studies have shown that most retirees exhaust their lump-sum payouts within three to eighteen months. Many cite family obligations, medical emergencies, debt, or poor financial planning as key reasons why they quickly spend their retirement funds.
Research conducted by the ENPF, in collaboration with the Eswatini Economic Policy Analysis and Research Centre (ESEPARC), has further supported the push for a national pension scheme. The studies have revealed concerning statistics that show retirees who receive lump sums often find themselves destitute within a short period, leading to the argument that the current system fails to provide long-term financial security.
The issue of long-term financial stability is also raised by Thembinkhosi Mabuza, who supports the idea of a pension-based system due to its potential health advantages. “A steady pension contributes to a longer lifespan,” Mabuza said, while also cautioning against any potential merger between the ENPF and other contributory pension schemes, a concern that is unrelated to the proposed conversion bill. Nkabinde clarified that the conversion bill does not mandate a merger with any other pension schemes, including the Public Service Pension Fund (PSPF). Instead, the bill is designed to complement existing systems, not absorb them.
The practical realities of the proposed pension scheme were addressed by Zanele Hlophe, who asked whether retirees would receive enough income if the pension system were implemented today and whether dependants would be taken care of in the event of a retiree’s death shortly after retirement. These concerns were clarified by experts, who assured that survivor benefits are a core component of the pension system, ensuring that dependants receive ongoing financial support after the pensioner’s death. Under the current lump-sum model, once the payout is exhausted, there are no further benefits for the retiree’s family.
Another contributor, Sibusiso Methula, raised concerns about the broader labor environment, particularly the instability faced by short-term and seasonal workers. Methula argued that no pension reform would be complete without addressing the vulnerabilities of workers who contribute sporadically. This highlights a key feature of the proposed conversion: it would enable workers with fragmented employment histories to still accumulate enough for a reliable income in retirement. According to the proposed system, as long as these workers make contributions amounting to a minimum of 180 months (even if non-consecutive), they would be entitled to a pension.
Although the proposed conversion has garnered significant support, some emaSwati remain attached to the lump-sum model. Critics argue that the large payout offers freedom of choice—whether it be to buy a house, pay off debt, or start a business. However, data from the ENPF suggests that the so-called “freedom” provided by lump sums is often short-lived. Without recurring income, many retirees quickly fall into poverty. Medical clinics have reported a rise in elderly patients who cannot afford medication, and families are feeling the strain of supporting parents who have exhausted their retirement funds.
Proponents of the pension scheme argue that a pension system offers not only long-term financial security but also dignity. It provides retirees with a guaranteed monthly income for life, unlike the lump-sum model that often leads to financial vulnerability. Additionally, the pension system includes survivor benefits, ensuring that families are not abandoned when a pensioner passes away.
One of the most powerful testimonies in favor of the pension scheme came from former seasonal worker Nathi Vilakati, who shared his personal experience of never saving enough during his working years. “A pension scheme is the only guarantee that someone like me will not die without income,” Vilakati said. His testimony resonates with many casual and temporary employees who make up a significant portion of Eswatini’s workforce. The current lump-sum model fails to serve them well, as it offers a one-time payout that rarely provides for long-term well-being.
Despite the growing support for the conversion, the lump-sum model still has its defenders. Many workers continue to believe that the large payout offers more immediate freedom, even if it only lasts a short while. However, the reality is that without a consistent income, many retirees fall into financial despair.
Ultimately, the proposed pension system is viewed by many as a way to uplift not only individual workers but their families and the nation as a whole. By providing guaranteed income for life and offering survivor benefits, the new system promises to reduce poverty among the elderly and bring about a more secure, dignified future for emaSwati.
The ongoing debate surrounding the conversion continues to evolve, with Likhweti remaining a key platform for transparent and informed engagement. Whether supporters or critics of the conversion, the nation’s full understanding of the reform remains critical.
Discussion about this post