Pension (Pensionable Emoluments) Directive 2025

GOVERNMENT NOTICE NO. 58
PENSION ACT
(NO. 6 OF 2023)
PENSION (PENSIONABLE EMOLUMENTS) DIRECTIVE, 2025 IN EXERCISE of the powers conferred by section 68 (1) of the Pension Act, 2023, I, DR. MACDONALD MAFUTA MWALE, Registrar of Financial Institutions, issue the following Directive__

1. This Directive may be cited as the Pension (Pensionable
   Emoluments) Directive, 2025.
2. The objectives of this Directive are to provide__
   (a) for details of what constitutes pensionable emoluments; and (b) a basis for calculation of pension contributions. 3.(1) For purposes of calculating pension contributions under section 12 of the Act, pensionable emoluments shall include the following (a) guaranteed wages; (b) housing or accommodation allowance; (c) commissions payable regularly either as the only form of remuneration or in addition to a minimum basic pay; and (d) any other allowance received by an employee, in cash, in the course of his normal duties as outlined in the employee’s contract of employment. (2) For purposes of this paragraph__ (a) an “allowance” shall constitute any cash payment made to an employee in addition to a basic salary as provided in the employees contract of employment, except those listed as exclusions in paragraph 4; and (b) a housing or accommodation allowance shall only be included as part of pensionable emoluments the allowance is not payable in lieu of provision of accommodation and exceeds forty percent of an employees’ guaranteed wages, and where the housing or accommodation allowance exceeds forty percent of guaranteed wages, only the excess amount shall be included as part of pensionable emoluments.
3. For purposes of calculating pension contributions under section 12 of
   the Act, pensionable emoluments shall not include the following, unless a contract of employment or collective agreement expressly provides otherwise__ (a) any cash payment or payment in kind provided to enable an employee to work, including an equipment, tool or similar allowance and which includes a hardship allowance; (b) a business travel allowance; 363 The Malawi Gazette Supplement, dated 4th July, 2025, containing Regulations, Rules, etc. (No. 20A) Citation Objectives Pensionable emoluments Exclusions from pensionable emoluments

(c) disability and workers compensation; (d) protective clothing and equipment; (e) a utilities allowance; (f) a domestic workers’ allowance; (g) a security allowance; (h) a relocation allowance; (i) a tip received from customers; (j) a gift from an employer; (k) share incentive schemes; (l) a bonus relating to performance of an employment contract except where it is the only form of remuneration; (m) discretionary payments not related to an employee’s hours of work or performance, including a discretionary profit-sharing scheme; (n) benefits in kind such as meal vouchers, security provision, medical aid and similar insurance schemes; (o) an entertainment entitlement or entertainment allowance; (p) an education entitlement or education allowance; (q) payments for overtime, including payments for hours worked in excess of those stipulated in an employee’s contract of employment; (r) an acting allowance or any allowances for the performance of duties which do not form an integral part of the duties of an officer’s own post, including occasional work performed for another department or office; (s) any payment in lieu of leave holidays; (t) leave grant; (u) any payment made in consequence of an achievement award; (v) provision of an allowance in lieu of a car or fuel; (w) a membership allowance to clubs or a professional body; (x) subsistence allowances; (y) a spouse’s allowance; (z) a furniture allowance; and (aa) director’s fees or sitting allowances.
5. The Pension (Pensionable Emoluments) Directive, 2014 is revoked.
Made this 7th day of February, 2025.
DR. M. M. MWALE
(REF. NO. FIN/PFSPD/01/06) Registrar of Financial Institutions 364 4th July, 2025 Revocation GN 32 of 2014