Forgotten fortunes: US$14.25m in unclaimed benefits as thousands of Zimbabweans struggle in retirement

CLOUDINE  MATOLA

Tens of thousands of Zimbabweans who should be living in the dignity of retirement are instead facing poverty and uncertainty, as a staggering US$14.25 m in pension benefits remains unclaimed. The amount—more than double the US$7 million recorded in 2023—reflects not only deep cracks in pension fund management but also a national failure to safeguard the livelihoods of the elderly and vulnerable.

At the heart of the crisis is a troubling mix of poor record-keeping, lack of member education, and outdated systems that continue to deny beneficiaries access to what is rightfully theirs. According to official data from the Insurance and Pensions Commission (IPEC), a total of 94,702 pension fund members had unclaimed benefits by the end of December 2024. These individuals, who spent decades working and contributing to pension schemes, are now unable to access their entitlements due to structural and administrative failures.

The data further shows that self-administered funds accounted for the largest share of unclaimed benefits, making up 48% of the total. Insured funds followed with 30%, while stand-alone funds made up the remaining 22%. The figures are damning, painting a picture of systemic neglect that has turned retirement into a period of suffering for thousands.

Two of Zimbabwe’s largest pension funds—the Motor Industry Pension Fund and the Zimbabwe Electricity Industry Pension Fund—have already transferred US$13,133 and US$19,698 respectively to the Guardian Fund, the statutory repository for unclaimed funds, in a move that underscores the gravity of the situation.

Sandra Musevenzo, director of the Zimbabwe Association of Pension Funds (ZAPF), attributed the increase in unclaimed benefits to a range of persistent challenges that have not been addressed for years.

“The growth in unclaimed benefits can be attributed to various factors, although the exact reasons are unclear due to a lack of concrete information. Some potential contributing factors include data integrity issues: poor record-keeping, outdated records, and legacy weaknesses in data management make it challenging for pension funds to trace members with unclaimed benefits,” Musevenzo told Business Times.

She added that the problem is compounded by insufficient education for pension fund members, who often do not understand what benefits they are entitled to or how to go about claiming them.

“Some pension funds may not adequately educate members on their benefits and the claims process, leading to a lack of understanding about entitlements and procedures. Additionally, fund members may not inform spouses or beneficiaries about survivor benefits, resulting in unclaimed benefits due to a lack of knowledge,” she said.

Musevenzo further noted that in many cases, benefit values are so low that the cost of claiming them outweighs the value, effectively discouraging members from going through the process.

“In some cases, individual membership values are extremely low, making it uneconomical for members to claim their benefits due to the high cost of claiming,” she said.

Legacy data problems also continue to haunt pension administrators. Many schemes are unable to trace members whose benefits became due after Zimbabwe’s 2009 currency switch, due to gaps in data continuity. This has been worsened by poor data transfer during business transitions, with incomplete or outdated records being passed from one fund administrator to another.

To address the crisis, Musevenzo called for sweeping reforms in how pension data is managed and how funds communicate with their members.

“To effectively manage unclaimed benefits, proper data collection and maintenance systems are essential for tracking pension fund members and facilitating regular communication. Strategies to educate members and trace unclaimed benefits should include digital communication, such as utilising bulk messaging platforms to reach members,” she explained.

She said it was also important to implement more direct outreach initiatives, such as writing letters and making phone calls to members and their next of kin. Engaging members in-person through site visitations, home visits, roadshows, or member communication tours would also help raise awareness.

“Public disclosure, like publishing the names of affected members on the fund’s website, is another step that can help reunite members with their benefits,” Musevenzo added.

Some institutions have already taken steps to make it easier for members to locate unclaimed benefits. IPEC, for example, has introduced a search engine on its website that allows individuals to check if they are owed any money.

Mavukeni Rufai, Secretary-General of the Life Offices Association of Zimbabwe, echoed similar concerns and said the dramatic rise in unclaimed benefits is largely due to lack of awareness and administrative inefficiencies.

“The significant increase in unclaimed benefits, which has grown by 104% to $14.25 million, can be attributed to a variety of factors. One primary reason is the lack of awareness among employees regarding their entitlements,” Rufai said.

He cited findings from the 2024 Q4 Life Industry Report, which indicate that many workers are unaware of what they are due and the procedures for accessing these funds. Rufai added that delays in processing claims and inaccurate record-keeping have further contributed to the situation.

“The economic overview in the report highlights broader financial hardships that many employees face, which can lead them to overlook their benefits, further exacerbating the issue,” he said.

To correct the situation, Rufai said pension funds and regulatory bodies need to enhance communication with members and simplify the claims process.

“To address the problem of unclaimed benefits and ensure that employees receive their rightful entitlements, several measures should be implemented. Firstly, enhanced communication is essential. The 2024 Q4 Life Industry Report emphasises the importance of actively informing employees about their benefits through various channels, such as workshops and newsletters,” Rufai said.

He also suggested that simplifying claims processes and providing clear, easy-to-follow guidelines could go a long way in breaking down the barriers that currently prevent people from claiming their dues.

“Conducting regular audits of unclaimed benefits can help identify and rectify issues proactively. Finally, providing educational resources about the benefits and the claims process can empower employees to take action and claim what they are entitled to,” he said.

IPEC’s own internal data shows the problem is not only growing, but becoming more complex. Market conduct manager for pensions and life supervision at IPEC, Polite Chidumwa, said the latest increase is partly due to changes in benefit values.

“There are mainly two major reasons for the increase in unclaimed benefits during the quarter under review, which are an increase in the monetary value of the existing unclaimed benefits due to investment returns,” Chidumwa said.

He explained that many pension schemes declared increases and bonuses during the period under review, which elevated the value of previously unclaimed benefits. In addition, new benefits became due in the current period but were not collected, pushing the total number of affected members to 97,882—up from 94,702 in the previous quarter.

“This is reflected by an increase in the number of people with unclaimed benefits to 97,882, from 94,702 reported in the previous period,” he said.

To stem the tide, IPEC has rolled out several initiatives aimed at connecting members with their entitlements. These include public awareness campaigns to encourage former contributors to occupational pension schemes to check if they are owed benefits.

“We are strengthening the onboarding process by ensuring that, upon joining pension schemes, funds capture contact details of their members and their respective next of kin,” said Chidumwa.

The commission has also published lists of members with unclaimed benefits in national newspapers and continues to maintain the online search engine it launched to support benefit tracing.

But even as these efforts gather momentum, experts warn that time is running out for thousands of pensioners and their families who are barely surviving in the face of economic hardship, while money meant to cushion them remains locked away in bureaucratic systems.

For many of these individuals, their unpaid benefits represent more than just numbers on a spreadsheet—they are promises made and broken, lifelines lost in a system that has forgotten them.

The human cost of unclaimed benefits is immense. In a country already struggling with inflation, high unemployment, and a deteriorating social safety net, the continued failure to deliver pension entitlements to rightful beneficiaries is a silent crisis unfolding beneath the surface of public policy.

Without urgent intervention, Zimbabwe’s pension sector risks not only undermining public trust but also deepening poverty among those who can least afford it—the retired and the elderly who gave their lives to work, only to be forgotten in their hour of need.

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