The pension arrangements for Namibian Members of Parliament (MPs) and other office bearers are governed by the Members of Parliament and Other Office-Bearers Pension Fund Act 20 of 1999, a framework distinct from general pension schemes in the country. 

This legislation sets it apart from other pension funds as it was specifically established by an Act of Parliament, with its fund rules subsequently gazetted in the year 2000. 

Despite this uniqueness, the fund remains registered under the Pension Funds Act No. 24 of 1956, which governs pension and provident funds in Namibia. 

The distinct nature of this pension fund lies in its establishment and regulatory framework. 

Unlike other pension funds, which are typically set up by employers or industry bodies, this fund is statutorily created, ensuring that its governance and benefits structure align with the legislative framework governing political office bearers. 

Another unique feature is the employment tenure of MPs, which is generally limited to five-year terms, making their pension needs different from those of the general working population. 

As 21 March looms, with the transition of outgoing, incoming, and continuous members of parliament, the discussion takes on greater significance. 

This period of transition pres ents an impor t ant opportunity to reflect on the financial wellbeing of MPs, particularly in terms of their pension planning. 

Pension awareness among MPs 

Financial professionals and those well-versed in the pension space seem to avoid engaging MPs on pension planning for several reasons. It could be due to political sensitivity and public perception, as discussions around MPs’ pensions can be controversial. Their pension schemes are often government-funded and separate from occupational pensions, reducing the need for external advisors. The short-term nature of political tenure and state-backed benefits might also make them a less attractive market for private financial firms. 

Legal barriers, governance issues, and limited commercial interest could further discourage engagement. Additionally, there may be a general fear of victimisation, as speaking on such matters could be seen as interfering in political affairs. Through consultations with both incoming and outgoing MPs, it became evident that many MPs lacked awareness of the fundamental aspects of their pension fund and financial planning. This knowledge gap is concerning, as pension literacy is essential for financial preparedness, especially for MPs whose tenure in public office is often uncertain. MPs, like all individuals, must consider their financial security post-retirement. However, their situation is often more complex than that of ordinary workers due to the uncertainty of their tenure. Many MPs serve only a single term before transitioning into other careers, voluntarily or due to political shifts. Unlike in the past, when many politicians had long parliamentary careers spanning decades, the current political landscape sees a higher turnover of MPs, making pension planning even more crucial. 

Financial and pension literacy is essential for younger MPs who may assume retirement is still far off, as well as those over 55 who have spent years enjoying the benefits that come with being an MP, such as travel perks and, for some, additional privileges as Cabinet Members. Many MPs go through their careers without having to worry much about personal finances, but the reality of financial insecurity can eventually set in if proper retirement planning is neglected. 

It is, therefore, imperative for MPs to familiarise themselves with the commencement and cessation of their pension membership, particularly the provisions outlined in Article 48 of the Namibian Constitution, which governs the vacation of parliamentary seats. Equally important is understanding their retirement and withdrawal benefits to ensure that they make informed financial decisions during and after their term in office. Furthermore, understanding the structure and performance of their pension fund, including its risk profile and the returns on investments, is crucial. MPs should be aware of the charges associated with their fund, as these can impact their long-term savings. 

Regularly reviewing the fund’s performance and staying informed about changes in pension regulations or investment opportunities will help MPs make proactive decisions, ultimately leading to better financial security and peace of mind as they transition into retirement. 

Challenges of transitioning from parliament 

Leaving parliament can be a period of financial, employment, and emotional adjustment. While serving MPs receive structured remuneration and benefits, there is limited transitional financial support for those who exit before reaching the pensionable age. The transition out of Parliament can be particularly challenging for those who have not proactively planned for their post-political careers. Former MPs frequently encounter challenges when re-entering the job market. Many struggle to return to their former professions, particularly those who previously worked in public service. Fields requiring ongoing accreditation pose additional hurdles, as maintaining industry standards while serving in Parliament can be difficult. Employers may also be reluctant to hire former MPs due to concerns about political affiliations, further narrowing their career opportunities. To ensure a smoother transition for MPs, proactive career and financial planning must be integrated into their tenure from the outset. Providing financial literacy programmes and career transition counselling both during and after their tenure could help them manage post-political life more effectively. 

Encouraging new MPs to view their time in Parliament as temporary and to plan ahead for future careers can also ease the transition. Additionally, offering training programmes that help MPs articulate their transferable skills and obtain relevant certifications would enhance their employability. 

Reducing political careerism by promoting professional networking and exploring career opportunities beyond politics can help mitigate dependency on parliamentary roles. 

Moving forward 

The role of an MP is undoubtedly significant in shaping national policies, but the reality of parliamentary tenure being temporary underscores the need for comprehensive pension and transition planning. MPs must take proactive steps to understand their pension rights and obligations while simultaneously preparing for life beyond Parliament. 

With the right suppor t mechanisms, MPs (former) will be enabled to handle transitions more effectively and continue to contribute meaningfully to society even after leaving office. 

*Vincent Shimutwikeni is the Head: Legal and Compliance at the University of Namibia and a Trustee on a pension fund. He writes in his individual capacity