Legislation

A PROCLAMATION TO PROVIDE FOR PUBLIC SERVANTS’ PENSION PROCLAMATION No. 714/2011

PART THREE

PENSION SCHEME, FUNDS AND CONTRIBUTIONS

8. Establishment of Public Servants’ Pension Scheme

The Public Servants’ Pension Scheme is hereby established.

9. Establishment of Pensions Funds

The following public servants pension funds are hereby established:

1/ the Civil Service Pension Fund;

2/ the Military and Police Service Pension Fund.

10. Contributions to the Civil Service Pension Fund

The contributions payable to the Civil Service Pension Fund shall, based on the salary of the public servant, be:

1/ by the public office, 11%;

2/ by the public servant, 7%.

11. Contributions to the Military and Police Service Pension Fund

The contributions payable to the Military and Police Service Pension Fund shall, based on the salary of the public servant, be:

1/ by the public office, 25%;

2/ by the public servant, 7%.

12. Payment of Pension Contributions

1/Every public office shall deduct contributions of public servants from their salaries and pay the amount, together with its own contributions, to the pension fund monthly.

2/The contributions referred to in sub-article

(1) of this Article shall be paid to the pension fund within 30 days from the last day of the month in which payment of salary has been effected.

3/Where a public office fails to deduct contributions of public servants from their salaries, it shall be liable for payment of same.

4/Notwithstanding the provisions of sub-article

(1) of this Article, contributions of federal and regional public offices fully or partly run by government allocated budgets and their public servants shall be collected with in the period specified under sub-article (2) of this

Article by the Ministry of Finance and Economic Development or the appropriate regional government organs, as the case may be, and paid to the pension fund on the first working days of the following month..

5/Contributions of public offices run by their own income (non-budgetary) shall be collected within the period specified under sub-article (2) of this Article by the bodies to be delegated by the Agency and paid to the pension fund on the first working days of the following month.

6/The Agency shall have the power to supervise the proper computation of contributions to be collected in accordance with this Article.

7/The Ministry of Finance and Economic Development shall, upon being notified by the Agency the default of regional government offices in the timely payment of contributions and the amounts thereof, deduct the arrear contributions from their budgetary subsidies allocated by the federal government and pay same to pension fund.

8/Where a public office fails to pay contributions for a period of more than three months, the Agency or the delegated body shall have the power to cause the deduction of the arrear contributions from the budget allocated to it by the government or from its bank account.

9/Any bank shall, when requested by the Agency or the delegated body, have the obligation to deduct, without any precondition, the amount of contributions to be collected pursuant to sub-article (1) of this Article from the account of the public office and pay to the Agency or the delegated body.

10/Any public office which pays salary to public servants covered by pension scheme shall have the obligation to notify, in writing, to the Agency the branch of the bank and account number in which it has deposited money, and any change of address of the bank or account number within 15 days of the occurrence of such change.

11/In line with the directive issued by the Ministry of Finance and Economic Development to determine the rule for enabling the collection of tax by seizing and selling the property of tax payers who failed their obligation to pay tax, the Agency or the delegated body shall have the power to sell, through tender, the property of a public office for the purpose of collecting arrear contributions that could not be collected pursuant to sub-article (9) of this article.

12/For the purpose of compensating effects of benefits granted pursuant to sub-article (7) of Article 19 of this Proclamation to pension fund, the public office shall pay in advance the monthly contributions calculated for the remaining period that the public servant has to go through before he attains the retirement age.

13/For the purpose of compensating effects of benefits granted to an outgoing senior government official or member of parliament to pension fund, the Ministry of Finance and Economic Development shall pay in advance the monthly contributions calculated for the remaining period that the official or member has to go through before he attaines the retirement age.

14/It is prohibited to deduct from pension contributions for payment of service charges, money transfer charges or debt or for any other purpose.

15/The Agency may delegate activities, in relation to the collection and enforcement of pension contributions, to other bodies.

16/ The payment of pension contributions shall have priority over any debt.

13. Administration of Pension Funds

The pension funds established under Article 9 of this Proclamation shall be administered by the Agency.

14. Utilization of Pension Funds

1/ The pension funds shall be utilized only for:

a)effecting payments of benefits stipulated in this Proclamation;

b)investments in treasury bonds and other profitable and reliable investments to be specified by directive to be issued by the Ministry of Finance and Economic Development; and

c)covering the operational expenses of the Agency.

2/ Pension funds may not be attached or secured in respect of any debt.

15. Actuarial Analysis and Evaluation

The Public Servants Pension Scheme shall be evaluated by actuaries every five years.

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8 replies »

  1. I need ur help ,to know about pension /retirment payment ,i am working for 5yr and still on food security programe (HABP) with out PF & retirment,can i ask payment of PF With out contractul agrement.

  2. I am Mulu Miesho
    Dear Abrham, I just want to know that whether pension is paid/deducted from overtime work or not.

  3. you guys did a great help to want get the proclamations for different purpose. So, be stronge

  4. Your blog is extremely important; however, the soft copies are damaged and can’t be downloaded.

    • Thanks for the comment. It would be a great help if you could tell which of the file are damaged or may be corrupt.
      I will immediately re-upload the files. As regards downloading, I have already responded to this issue in my previous
      comment. All google document files are downloadable and I advise you to see my comment as regards downloading
      google docs. Click HERE to see.

      • Hi Abrish. Long time no see. i am glad and proud to see your move like this. your good old friend WASIHUN the lawschool. you may reach me using my account at wasabema@gmail.com

  5. pension scheme is good for private employes but before lunching this law government must think MINIMUM WAGES[SALARY]which worker must get.there is no minimum wages act for labour working in any organisation yet due to lack of this law wokers are not getting sufficient money for their lively hood.
    for example any one is getting 400 birr or 500 birr per month how he will manage his family and children education etc

    engineer suraj bhan [working in ethiopia]
    suraj_bhan78@rediffmail.com

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