Portability of Pension Benefits in Tanzania

Henry Chalu, Patrick Mbwile

Abstract


This study attempts to identify determinants of pension funds benefits portability in Tanzania. This study used primary data collected from 100 members of pension schemes through questionnaires. Utilizing regression analysis, the study examined the influence of administrative costs, information availability, pension funds, membership and economic factors on members’ preferences for portable pension schemes in Tanzania. The results reveal that factors that significantly influence the portability of pension funds include pension schemes factors, member factors and economic factors. The study recommends that to make effective portability, regulators should design portability policies that are beneficial to both pension schemes and members. Likewise, policies should take into consideration economic factors. One limitation of this study is that data was collected from a small sample and only five factors were tested. Hence, future studies can use large numbers and test more factors.

Keywords: Portability, pension benefits, pension funds, portable schemes, members’ preferences

Henry Chalu, Senior Lecturer, University of Dar es Salaam; Email: henrychalu@udbs.udsm.ac.tz
Patrick Mbwile, Assistant Lecturer, University of Dar es Salaam; Email: pmbwile@udbs.udsm.ac.tz


Full Text:

PDF

References


Antolín, P., and Harrison, D. 2012. “Annual DC Pension Statements and the Communications Challenge,” OECD Working Papers on Finance, Insurance and Private Pensions, No. 19, OECD Publishing. http://dx.doi.org/10.1787/5k97gkd06kth-en (accessed: January 10, 2014)

Apilado, V. P. 1972. “Pension Funds, Personal Savings, and Economic Growth”. The Journal of Risk and Insurance. Vol. 39, No. 3, pp. 397404. American Risk and Insurance Association.

Black, D and Orszag, M, J. 1997. “Portability and Preservation of Pension Rights in the United Kingdom”. Report of the Director General’s Inquiry into Pensions, Vol. 3. UK Office of Fair Trading, London, UK

Bodie, Z., Marcus, A.J., and Merton, R.C. 1988. “Defined Benefit versus Defined Contribution Pension Plans: What are the Real Trade-offs?” In Pensions in the U.S. Economy, pp. 139-162

CanagaRetna, S. M. 2006, June 30. “Pension Portability among Public Health Officials”. Southern Legislative Conference - The Council of State Governments’ Southern Office. Atlanta, GA

Chernev, A. 2004. “Goal-attribute Comparability in Consumer Choice”. Journal of Psychology, Vol. 14, No. 3, pp. 141-150

Clark, L. A., and Watson, D. 1995. “Constructing validity: Basic Issues in Objective Scale. Development”. Psychological Assessment, 7, pp. 309-319.

Cocco, J. F., and Lopes, P. 2011. “Defined Benefit or Defined Contribution? An Empirical Study of Pension Choices”. Journal of Risk and Insurance, Volume 78, Issue 4, pp 931–960. DOI: 10.1111/j.15396975.2011.01419.x

Courville, T., and Thompson, B. 2001. “Use of Structure Coefficients in Published Multiple Regression Articles: ß is not Enough”. Educational and Psychological Measurement, Vol. 61, No. 2, pp. 229-248.

Cruz, A.T. 2004. Portability of Benefit Rights: Probability of Benefit Rights in Response to External and Internal Labour Mobility: The Philippine Experience. Thirteenth Regional Conference for Asia and the Pacific, International Social Security Association, Kuwait, 8 – 10 March.

Dorsey, S. 1995. “Pension Portability and Labour Market Efficiency: A Survey of the Literature”. Industrial and Labour Relations Review, Vol. 48, No. 2, pp. 276-292

Edward, W. 2000. “Pension Reform, Financial Literacy and Public Information: A Case Study of the United Kingdom”. Social Protection Discussion Paper. 21312 No. 0004

Forteza, A. 2008. “The Portability of Pension Rights: General Principles and the Caribbean Case”. Development Policy Review, Vol. 28, Issue 2, pp. 237-255. http://dx.doi.org/10.1111/j.1467-7679.2010.00483.x

Foster, A. C. 1994, July. “Portability of Pension Benefits among Jobs”. Monthly Labour Review, Vol. 117, No.7

Gliem, J.A., and Gliem, R.R. 2003. Calculating, Interpreting, and Reporting Cronbach’s Alpha Reliability Coefficient for Likert-Type Scales. 2003 Midwest Research to Practice Conference in Adult, Continuing, and Community Education.

Gough, O. 2004. “Why do Employees, particularly Women, Reject Occupational Pension Schemes?” Employee Relations, Vol. 26 Issue: 5 pp. 480 – 494 http://dx.doi.org/10.1108/01425450410550464

Gözbaşı, O., and Çıtak, L. 2010. “An Evaluation of the Attributes Considered by Investment Professionals in Selecting Mutual Funds: The Case of Turkey”. International Research Journal of Finance & Economics, No. 36, pp. 180-195

Guardiancich, I., and Natali, D. 2012. “The cross-border portability of supplementary pensions: Lessons from the European Union”. Global Social Policy, Vol. 12, No. 3, pp. 300-315.

Gupta, V. 2006. “Pension risk: do employees care?” Pensions, Vol. 12, No. 1, pp 4-11.

Hair, J. F., Tatham, R. L., Anderson, R. E., and Black, W. 1998. Multivariate data analysis (5th ed.) Prentice Hall.

Holzmann, R. and Koettl, J. 2011. “Portability of Pension, Health, and other Social Benefits: Facts, Concepts, Issues”. Social Protection Discussion Paper. 62725 No. 1110

Holzmann, R., Koettl, J., and Chernetsky, T. 2005. Portability Regimes of Pension and Care Benefits for International Migrants: An Analysis of Issues and Good Practices. Paper presented for the Global Commission on International Migration, May 23.

Kothari, C. R. 2004. Research Methodology Methods and Techniques, New Delhi: New Age International Publishers.

Larsson, L., Sundén, A., and Settergren, O. 2009. “Pension Information: The Annual Statement at a Glance”. OECD Journal: General Papers. 2009, Vol. 8 Issue 3, p131-171.

Lincoln, Y. S., and Guba, E. G. 1985. Naturalistic inquiry. Newbury Park, California: SAGE Publications Inc.

Mchomvu, A.S.T., Tungaraza, F.S.K., and Maghimbi, S. 2002. “Social Security Systems in Tanzania”. Journal of Social Development in Africa. Vol. 17 No. 2.

Mhango, M. 2012. “Pension regulation in Malawi: Defined benefit fund or defined contribution fund?” Pensions, Vol. 17, No. 4, pp. 270–282

NAO. 2010. A Performance Audit on the Processing of Terminal Benefits of Retirees from the Central and Local Government of Tanzania. A Report of the Controller and Auditor General of the United Republic of Tanzania.

Nathans, L.L., Oswald, F.L., and Nimon, K. 2012. “Interpreting Multiple Linear Regression: A Guidebook of Variable Importance”. Practical Assessment, Research & Evaluation, Vol. 17, No. 9, pp. 1-19.

NCCB and USCC. 1990, November. “Final Report: Portability of Pension Benefits for Diocesan Lay Employees”. Resources for American Christianity. Retrieved from http://www.resourcingchristianity.org/grant-product/final-reportportability-of-pension-benefits-for-diocesan-lay-employees (Accessed: November 2013).

Nunnally, J. C., and Bernstein, I. H. 1994. Psychometric theory (3rd ed.). New York: McGraw- Hill.

OECD. 2013. Improving Pension Information and Communication: OECD Survey and Lessons Learnt. OECD, Paris.

Pedhazur, E. J., and Schmelkin, L. P.1991. Measurement, design, and analysis: An integrated approach (Student ed.). Hillsdale, N.J.: Lawrence Erlbaum Associates.

Ramasamy, B., and Yeung, M.C.H. 2003. “Evaluating Mutual Funds in an Emerging Market: Factors that Matter to Financial Advisors”. International Journal of Bank Marketing, Vol. 21 No. 3, pp.122 - 136

Rietjens, M. 2011. Young People’s Preference for Financial Versus nonFinancial Attributes of Pension Funds. Msc Thesis, Faculty of Economics and Business Administration, University of Maastricht.

Romagna, R.E. 2008. Portability of Pension Benefits as a Means to Foster Trans-national below Mobility: Critical Recommendations on the Italia-Albania Case. Steering Economic and Social Cohesion in the CADSES Space: Valuing Migration as Development tool.

Spector, P. 1992. Summated rating scale construction Thousand Oaks, CA: Sage

Turner, J. A., Tabitha, A. Doescher and Phyllis, A. F. 1993. "Job Mobility and Pension Portability." Pension Policy for a Mobile Labour Force. Kalamazoo, MI: W.E. Upjohn Institute for Employment Research, pp. 1-9.

Willborn, S. 1998. “The Problem with Pension Portability”. Nebraska Law Review, Vol. 77, No. 1, pp. 352.


Refbacks

  • There are currently no refbacks.


 [ISSN 0856-0056 (Print) & ISSN 1821-889X (Online)]