8,791 retirees erroneously paid K1 m in allowances

By NATION REPORTER A TOTAL of 8,791 retirees were paid various allowances amounting to K1,000,995 during 2025, the Auditor General’s Report has revealed. The allowances included acting, combat, remote hardship, responsibility for teachers, rural hardship, salary arrears and transport allowances. The report has also raised concerns over the failure by Government to configure the Payroll Management and Establishment Control (PMEC) System with business rules governing the administration of retirees who remained on the payroll while awaiting pension benefits. Article 189 of the Constitution of Zambia (Amendment) Act No. 2 of 2016 requires pension benefits to be paid promptly and regularly. “The provision states that where pension benefits are not paid on an employee’s last working day, the employee should stop working but remain on the payroll and continue receiving their last salary until the pension benefit is paid,” the report read in part. According to the Auditor General, Circular No. B26 of 2022 further clarifies that retirees retained on the payroll while awaiting pension benefits are entitled only to their last basic salary and, where applicable, housing allowance for officers not provided with institutional accommodation. Retirees who had already received repatriation allowance were entitled to basic salary only until their pension benefits were settled. “However, during the period under review, the 8,791 employees were placed on the Separatees payroll and paid salaries totalling K728, 110, 028,” the report stated. A review of the PMEC System showed that rules relating to the administration of Separatees following the enactment of Article 189 and the subsequent circular had not been configured to ensure compliance with the provisions. “The Auditor General further found that the system continued to run 77 deductions, including Pay As You Earn, overpayments, pension contributions and rural/remote hardship allowances, involving K76, 926, 348,” it stated. The Auditor General’s Report stated that the findings raise concerns over weaknesses in the administration and control of the payroll for employees who had ceased active service but were awaiting settlement of their pension benefits. ENDS

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