The move aims to protect pensioners’ income from the erosion of purchasing power.
This was announced on Thursday after the GIPF board of trustees approved a pension increase, which took effect at the beginning of April.
CEO of GIPF, David Nuyoma, during the brief said this decision followed thorough considerations of all variables, including investment returns and risk on one hand and Consumer Price Index (CPI) on the other, given the institutions policy to target inflation-linked pension increases.
“Although inflation rates have been largely flat around 3 percent to 3.4 percent in 2015, there has been a sharp increase in this rate which stood at 6.1 percent during Feb. 2016,” he said.
According to Nuyoma the price of the food basket will continue to worsen and pensioners are more likely to feel the pinch due to the eminent drought and lower agricultural production.
Despite the fund granting the pension increases, Nujoma said it had not been easy due to the backdrop of meagre investment returns recorded for the year as well as world markets declining, which affected everyone.
Nujoma said that currently the GIPF pension payroll continues to grow and as of the end of Feb. 2016, the number of annuitants stood at 31, 692, with the fund paying out 2.2 billion Namibia dollars (147 million U.S. dollars) in pension benefits. Enditem