Section 81: Pension Fund and Passage Fund

81. Pension Fund and Passage Fund (1) A Municipal City Council, Municipal Town Council or District Council shall, with the approval of the Minister, establish for its officers, a Pension Fund, which shall be administered by the Company, and a Passage Fund. (2) There shall be paid into a Pension Fund— (a) the aggregate of the contributions made by the local authority; (b) income derived from investments of the Pension Fund; (c) any sum that may become payable to the Pension Fund following the transfer of an officer from another local authority, from the public service, from a statutory body or from any other institution; (d) such other money as may accrue to the Pension Fund. (3) There shall be paid out of a Pension Fund— (a) any pension benefit; (b) the cost of administration of the Pension Fund. (3A) (a) Any person who had retired from a local authority as at 31 December 2012 shall continue to be paid his pension benefits by the local authority where he was employed immediately before his retirement. (b) The pension benefits referred to in paragraph (a) shall be paid out of the General Fund of the local authority where the person was employed. (3B) Where an officer was appointed in a local authority before 1 July 2008 and is still an employee as at 31 December 2012, the local authority shall transfer to the Company the fund, in respect of its liability for the past service of the officer before 1 July 2008, for payment of the appropriate pension. (4) The Company shall, at intervals of not more than 5 years, cause an actuarial investigation into every Pension Fund and, in the light of the actuarial report, shall determine what readjustments or modifications, if any, in the working of a Pension Fund are necessary in the interest of the beneficiaries, and the local authority shall comply with the recommendations made by the actuary with effect from the date on which the recommendations are notified to the Company. (5) There shall be paid into a Passage Fund— (a) all passage benefits due to the officers of the local authority; (b) income derived from investments of the Passage Fund; (c) any sum that may become payable to the Passage Fund following the transfer of an officer from another local authority, from the public service, from a statutory body, or from any other institution; (d) such other money as may accrue to the Passage Fund. (6) There shall be paid out of a Passage Fund solely payments of passage benefits for officers. [S. 81 amended by s. 15 (a) of Act 26 of 2012 w.e.f. 22 December 2012.] L18 – 51 [Issue 5] Local Government Act