This archive report was first published on 23 April 2020.
On April 23, 2020, National Assembly Majority Leader Aden Duale published an omnibus law that proposes to remove a restriction on the use of retirement benefits scheme funds.
The proposed amendment to the Retirement Benefits Act would allow a percentage of the funds to be used for the purchase of a residential house, in addition to securing a mortgage loan.
According to Mr. Duale, the current law restricts the use of retirement benefit scheme funds, only allowing them to be used to secure a mortgage loan.
However, the proposed amendment would remove this restriction, which prohibits schemes from using their funds to offer direct or indirect loans to any person.
The Retirement Benefits Act requires every scheme to have a prudent policy on the investment of the funds to maintain capital and secure market rates of return on the investment of such funds.
Mr. Duale's proposed amendment would also require the submission of a statement of all investments of the scheme fund to the chief executive officer, in a form and manner prescribed by the minister.
