By Tokiso TKay Nthebe
The pension fund industry in Lesotho is evolving — and fast. With the enactment of the Pension Fund Act (PFA) No.5 of 2019 and the Pension Fund Regulations of 2020, the country has laid a strong legal foundation to govern retirement funds. For decades, the sector operated under fragmented laws like the Income Tax Act and Insurance Act, but this new legislation marks a game-changing shift for retirement planning in Lesotho.
With formal pension legislation in place, Lesotho has the opportunity to transform retirement savings into long-term capital for infrastructure, business investment, and job creation. This is crucial not just for financial inclusion, but for national economic growth.
Why Pension Laws Matter
Retirement laws help pension funds govern, administer, and manage retirement assets responsibly. As a retirement fund member, you need to understand the laws that protect your future. More importantly, you should know the role of key stakeholders — especially the Principal Officer (PO) — who manage your pension on your behalf.
Who is the Principal Officer?
The Principal Officer is the Chief Executive Officer of a retirement fund. Appointed by the Board of Trustees, the PO oversees fund governance, regulatory compliance, and risk management. Whether it’s an occupational fund (employer-based) or an umbrella fund (multiple employers under one scheme), the PO ensures your retirement fund is well-run and aligned with your long-term financial goals.
In Lesotho, the PO is accountable to:
- Members of the fund
- Board of Trustees
- Registrar of Pensions (Central Bank of Lesotho)
They serve as a bridge between the fund and the Regulator, ensuring the fund remains compliant and transparent.
Requirements to Become a PO in Lesotho
Under the PFA, a PO must:
- Be a resident of Lesotho
- Meet fit and proper standards (e.g., sound financial management, relevant qualifications, and fiduciary competence)
- Act with care, diligence, and always in the best interests of members
Why Members Should Care?
Your pension is likely one of your largest financial assets. Understanding how it is managed — and by whom — is critical to successful retirement planning. When you understand the PO’s role, you’re better equipped to:
- Ask the right questions about fund performance and compliance.
- Ensure you’re part of a registered and compliant pension fund.
- Advocate for your financial future.
In conclusion
As members of retirement funds, we must close the information gap that exists between fund managers and members. While the law is there to protect us, it’s our responsibility to stay informed and engaged.
Tokiso TKay Nthebe is a financial planner, author, podcast host, and founder of TKO Financial Wellness & Advisory. He is passionate about financial education, retirement planning, and creating a financially empowered Africa.
Subscribe to the FREE email newsletter for financial tips and tools: www.mymoneyadventures.com
Contact: info@tkofinancialwellness.com
Disclaimer: This article is for educational purposes only and does not constitute financial advice. Please consult a licensed financial adviser for tailored guidance.
