By Suleman Chitera
Member of Parliament Noel Lipipa has welcomed the decision by the Registrar of Financial Institutions to call for the immediate suspension or review of the Public Service Pension Trust Fund (PSPTF)’s proposed acquisition of the Amaryllis Hotel, describing the intervention as necessary to safeguard pensioners’ funds.
In a strongly worded statement, Lipipa said the regulator’s action reflects growing concern that the MK128 billion transaction may not represent value for money and could potentially expose pensioners to massive financial loss.
Valuation Under Scrutiny
The PSPTF had moved to acquire the Amaryllis Hotel, a high-end hospitality property in Blantyre, in a deal reportedly valued at MK128 billion. However, Lipipa questioned the rationale behind the valuation, arguing that the pricing structure appears “grossly inflated” and lacks convincing justification.
According to the legislator, the transaction resembles “a blank cheque issued to the seller and their intermediaries,” raising what he termed serious red flags about possible financial impropriety.
“One could see pensioners lose billions of kwacha,” Lipipa said, adding that the deal could either go down as the “Sale of the Century” or the “Heist of the Decade.”
Governance and Legal Concerns
Beyond valuation issues, Lipipa suggested that the Fund’s board may have breached both statutory obligations and its own constitutional requirements. He argued that major investment decisions of this magnitude should be subjected to a transparent process that includes meaningful public participation by PSPTF members.
If such procedures were bypassed, he warned, the board could face legal and fiduciary accountability challenges.
The PSPTF, as a mandatory retirement savings vehicle for public servants, is governed by strict prudential and governance standards designed to protect contributors’ long-term interests. Trustees are legally bound to act in the best interests of beneficiaries and to exercise due diligence in investment decisions.
Context of Pension Payment Concerns
Lipipa further noted that the timing of the proposed acquisition has intensified public outrage. He pointed out that some pensioners have reportedly experienced delays in receiving their dues, making the scale of the hotel transaction particularly troubling.
“To imagine that the Fund fails to pay its bona fide pensioners their dues, and that this transaction comes to light in such a context, is not only deeply saddening but utterly unacceptable,” he said.
The criticism underscores a broader governance debate about balancing investment diversification with liquidity management. Pension funds typically allocate assets across real estate, equities, fixed income instruments and other vehicles to ensure long-term returns. However, such investments must meet rigorous valuation, risk assessment and return-on-investment benchmarks.
Importance of PSPTF Integrity
Lipipa emphasized that the PSPTF remains a critical pillar of Malawi’s social protection architecture. The Fund is designed to ensure that public servants retire with financial dignity while also providing safety nets against old-age poverty, disability and death.
He stressed that protecting the integrity of the PSPTF requires:
- Strict compliance by employers in remitting contributions.
- Strengthened corporate governance and transparency mechanisms.
- Prudent, stable investment strategies aligned with beneficiaries’ interests.
The Registrar’s intervention now places the transaction under regulatory review, a move likely to subject the valuation, procurement process and board decision-making to closer scrutiny.
As stakeholders await further clarification from both the PSPTF and the Registrar of Financial Institutions, the controversy is expected to intensify debate over pension fund governance, fiduciary responsibility and the protection of public servants’ retirement savings.
