Weddings off limit in pension purse Justicia Shipena Members of the Government Institutions Pension Fund (GIPF) will not be allowed to use their pension savings to pay for weddings. GIPF chief executive officer Martin Inkumbi confirmed this during a press conference on the pension-backed home loan scheme (PBHLS), held on Monday. He said pension savings may also not be used for business ventures or any other non-housing-related expenses. “A member can access that money to finance their wedding; it is not allowed, and we unfortunately will not be able to allow the member to access money for that purpose, nor for other purposes, even including businesses, business opportunities or farming. That will not be permitted,” said Inkumbi. His comments follow a recent report by The Namibian showing that some couples are spending up to N$200 000 on weddings. Last month, the government approved the PBHLS, which allows GIPF members to access part of their pension savings for housing. “As I have indicated, this whole scheme is based on the provisions of the Pension Fund Act. GIPF is a pension fund, and there is a specific purpose of and use for pension fund resources, [which] is to provide pension benefits to members and, of course, their beneficiaries. It’s not to provide loans for consumer goods, etc,” Inkumbi said. He explained that the provision was introduced to help members who struggle to get home loans from commercial banks. “A recognition has been made that there is an opportunity to use pension benefits for a productive purpose, such as helping a member who maybe finds it difficult to acquire a house through commercial lending to acquire a home,” he said. On where members can build, Inkumbi said homes may be built in both proclaimed towns and rural villages, as long as there is proof of ownership or permission to occupy the land. “What is important is that you must have some form of ownership or permission to occupy the piece of land where that house is going to be built,” he said. GIPF further clarified that a primary home may be in either a rural or urban area. “A member can have two primary homes, as long as there is some criteria we check for primary residence, whether your kids are staying in that house… or you yourself,” Inkumbi said. At the same time, Inkumbi announced that GIPF has unlocked access to pension-backed housing loans, committing up to N$900 million to help members buy or build homes.  Members will now be able to borrow up to one-third of their pension benefits for this purpose. The Fund is also preparing to roll out the PBHLS, but full implementation depends on the signing of a Memorandum of Understanding (MoU) with the office of the prime minister. The MoU will define the roles and responsibilities of each party.  The scheme will only launch once the interest rate, set at the repo rate plus 2.5%, is officially gazetted. The GIPF board of trustees approved the rule amendments for the scheme in 2016.  Regulatory approval from the office of the prime minister and the Namibia Financial Institutions Supervisory Authority (Namfisa) followed in 2018. The PBHLS is aimed at active GIPF members and it allows them to use their pension benefits as collateral to secure home loans, particularly for those who do not qualify for traditional financing. First Capital Housing Scheme and Kuleni Financial Services have been selected to manage applications, repayments, and member support under the scheme.

#Weddings #PensionSavings #GIPF #FinancialPlanning #Namibia

GIPF’s housing scheme in final stages Chamwe Kaira The Government Institution Pension Fund (GIPF) is finalising a Memorandum of Understanding (MoU) with the Office of the Prime Minister for the Pension Backed Home Loan Scheme (PBHL). Edwin Tjiramba, general manager for marketing and stakeholder engagement, told Observer Money that the fund will soon inform members and stakeholders of the outcome and the way forward.  He declined to answer further questions, saying the fund is not in a position to share more information at this stage. In its 2024 Annual Report, GIPF said it had been engaging stakeholders on the PBHL scheme. The initiative is designed to allow members to access a portion of their pension savings for buying or improving property. The fund stated that the scheme aims to boost financial flexibility and encourage homeownership. It also aims to help address housing challenges while contributing to broader economic growth. The board has approved the scheme, which allows members to use their pension as security for home loans. GIPF said the approach will assist those who may not qualify for loans from commercial banks, regardless of their location. In July 2023, GIPF announced that the rollout was expected soon. It noted that only 30% of its members currently have access to adequate housing. GIPF said the PBHL scheme is a key part of its short-term strategy to improve member welfare by making homeownership more accessible. Over the medium term, the fund said it will focus on strengthening its investment strategy.  It aims to achieve returns of inflation plus 5% by working with top asset consultants and maintaining a diversified portfolio. The fund said this target is essential for growing assets and ensuring it can meet long-term obligations.  GIPF remains committed to keeping the fund fully funded and able to deliver promised benefits to all members. The housing shortage in the country continues to grow. The parliamentary committee on economics and public administration recently reported a backlog of 300,000 housing units. The report called for investment in urban land development and affordable housing, especially for first-time buyers and low-income households. Namibia’s 2023 National Housing Policy outlines key interventions, including the Participatory Informal Settlement Upgrading programme targeting 150,000 plots and the Sustainable Incremental Greenfield Development programme aimed at developing 130,000 plots. Urbanisation in Namibia has risen sharply, with the urban population growing from 28% in 1991 to 65.5% in 2023. This growth has led to an increase in informal settlements across the country.

#HousingScheme #HomeOwnership #GIPF #PensionSavings #EconomicGrowth

Michael Johnson: pensions are annuities - without the latter they're just savings like ISAs #pensionsavings

Reeves's proposal would remove cliff-edge where pushing pay above tax threshold means having to pay big pension contribution #pensionsavings

#pensionsavings Michael Johnson's tax relief proposals mean double taxation, or else even bigger tax breaks when *drawing down* savings

#pensionsavings Interesting thought from Michael Johnson: should have more emphasis on paying down personal debts vs building up pensions

#pensionsavings Michael Johnson says a cap on pension costs of 0.5% would still be generous. Should be aiming for 0.25%

#pensionsavings Interesting that Reeves hasn't mentioned that auto-enrolment threshold currently linked to tax and that's why it's increased

One of my challenges to Lib Dems was whether raising tax allowance further would take more out of #pensionsavings www.libdemvoice.org/opinion-making-allowance...

Rachel Reeves attacks Coalition's continued increases in the auto-enrolment threshold - a result of raising tax allowance #pensionsavings

#pensionsavings The political challenge for Labour: how to attack the government on the fairly successful roll out of auto-enrolment

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Labour to examine plans to increase pension provision for more than 1.5 million working people www.politicshome.com/uk/article/98700/labour_... #pensionsavings