By Daniel Chigundu
Life Assurance Association of Zimbabwe secretary-general Mavukeni Rufai has told Parliament that there is a need for another commission of inquiry to look at the current loss of value of pension, insurance and investments.
It is believed that millions of Zimbabweans might have lost value of their investment s and insurance when the government removed the Bond Note and US dollar parity.
Giving oral evidence before the Parliamentary Committee on Budget and Finance, Rufai said the country is facing similar challenges as those faced before 2009 which eroded peoples savings and that there is need to set the commission as soon as possible.
“The period between 2009 up to date might require us to have another commission of inquiry that is the reality of the future that we face because the values that have been contributed from 2009 up to 2016 have also been eroded.
“We sit here to discuss about the values that were eroded up to 2009 whereas we are also facing today the same problem, I just wanted members to understand that.
“Now, in summary, it is our view that the source of loss in value was the macro environment and actions of industry were a consequence of that loss of value, not the determining factor. If there had not been any hyperinflation, no currency debasing and no demonetisation then there would have been no loss of value that we face today,” he said.
Insurance and pension companies have been blamed for shortchanging their clients by failing to compensate them for the loss.
However, Rufai said the issue of loss of value needs a holistic approach and cannot be solved by a single stakeholder as it was a national disaster.
He said the first thing that is needed was to first determine the extent of the damage that was caused by the loss of value then stakeholders can jointly find solutions.
“In terms of way forward the Life Assurance Association of Zimbabwe believes that we need to acknowledge that the hyperinflation was a national disaster and that we need to jointly seek a solution.
“In addition to policyholders and pensioners, who lost value and their savings, banks, building societies and insurers that issued the mortgages or lent money to the government or statutory bodies or other debtors also lost value.
“Furthermore the shareholders of these institutions also lost significant value; secondly we need to carry sensitivity analysis to assess the damage that was caused by the loss of the value once the extent of the damage has been established we can then jointly seek solutions.
“And lastly to nationally determine how this gap can be financed in some countries where such disasters were experienced government played a bigger role in the restitution,” he said.
Rufai said the reason why the issue requires a national solution is that the insurance sector plays a key role in the country’s economic development through infrastructure development.
Currently, the insurance sector has been instrumental in the provision of houses and construction of power generation especially Kariba South Power Station generation.