The Effects of Early Access to Pension on the Financial Performance of the Public Pension Fund in Zambia: The Case of the National Pensions Scheme Authority (NAPSA)

Abstract

This paper aims to investigate the effect of early access to pension on the financial performance of the public pension fund in Zambian: The case of the National Pensions Scheme Authority (NAPSA). The key financial indicators (KPIs) examined in this study are: revenue from investments, contributions, net assets, and active members. The study covered the years, 2021 and 2022, years before the change in pension policy, and the two years, 2023 and 2024 which are post the coming into force of early access to pension.
A desk research methodology was employed and secondary data were collected from the NAPSA’s official website, and its audited financial statements for; 2021, 2022, 2023, and 2024. To obtain the econometric results, a Linear Regression Analysis (LRA) was used on the collected secondary data.
A comparison of the econometric results for the three periods; 2021-2022, 2022-2023, and 2023-2024, informs this paper to conclude that, relative to the four KPIs, early access to pension has a positive influence on the performance of the NAPSA, although not statistically significant. It was observed from the econometric results that for the periods, 2021-2022 and 2022-2023, with the exception of members’ contribution, that for every Kwacha of pension withdrawal, there was an increase in revenue from investments, value of the net assets, and population of members. However, in the period of 2023-2024, the LRA results indicate that for every Kwacha of early pension withdrawal, all the KPIs had a negative growth. The weaknesses and limitations of the study arose from lack of the financial data for 2025, and the very small data set covering two years (2023-2024) post coming into effect of early access to pension. The study offers recommendations to the Zambian government on the need to, in the long term, reform the pensions law.