Regulation 3 of the National Pension Scheme (Benefits and Eligibility) Regulations 2000 declared ultra vires the National Pension Scheme Act, 1996

Supreme Court of Zambia: An appeal was filed before a 3-Judge Bench comprising of M. Malila, C. Kajimanga and J.K. Kabuka, JJS., against the order where respondent’s entitlement to the pension was decided in favour of respondent.

The facts of the case were that the respondent was a member of the National Pension Scheme Authority retiring at the age of 55 with 137 contributions to the National Pension Scheme Authority (NAPSA). The fact that the provision for normal pension benefit required minimum 180 contributions resulted into payment of only a lump sum pension benefit, mandatory to be granted by virtue of Section 21 of the National Pension Scheme Act, 1996, Chapter 256 of the Laws of Zambia which was denied to him. The matter went before the trial court where respondent was granted lump sum pension amount on the above reasoning. Appellant preferred an appeal before the High Court where on the facts of the case it was found that the respondent was entitled to pension from the appellant. It is the above order against which appellant filed the present appeal before the Supreme Court. Respondent further filed a cross-appeal questioning the validity of Regulation 3 of the National Pension Scheme (Benefits and Eligibility) Regulations 2000 which widens the scope of persons who qualify beyond what is provided in Section 18 of the Act, pleading it to be ultra vires the act being inconsistent with Section 18 of the Act.

Appellant contended that he had the discretion to pay or not pay the lump sum amount to the respondent under Section 9(3) irrespective of the fact whether minimum required contributions were made or not and if such power is interfered with then it would undermine the entire essence of a scheme of pension. Whereas the respondent argued that the mandatory nature of Section 21 shows that appellant had no discretion whether to pay or not pay lump sum pension amount to respondent.

Supreme Court was of the view that discretionary power of the appellant cannot neglect the mandatory nature of Section 21 of the Act. With respect to the cross-appeal, Court held it to be ultra vires the Act to the extent of its inconsistency with Section 18. Therefore, appeal was dismissed upholding respondents cross-appeal. [National Pension Scheme Authority v. Phillip Stuart Wood,2018 SCC OnLine ZMSC 2, dated 25-10-2018]

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