Friday, October 30, 2020
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NSSF Bill: MPs Back Midterm Access

A section of MPs have supported the proposal by the joint committees of Finance and Gender, recommending for mid-term payment of NSSF savings.

Former Minister of Gender, Janat Mukwaya tabled the National Social Security Fund (Amendment) Bill, 2019 in August 2019 and the bill sought to provide for mandatory contributions of all workers regardless of the size of the enterprise or number of employees, provide for voluntary contributions to the Fund; to empower the Fund to recover from a third party any sum owed to a defaulting contributing employer to cover any contribution.

The Bill also sought to stipulate on penalty or interest; to provide for midterm access to voluntary contributions, to empower the Board to use in-house expertise and fund managers in the investments of scheme funds, including lending to Government; to empower the board to introduce new benefit in consultation with the Minister; to provide for the payment of an annual levy by the Fund to the Uganda Retirement Benefits Regulatory Authority and for related matters.

The joint Committee recommended to Parliament to approve Clause 10 on Mid-term Access to Voluntary Benefits.

The Joint-Committee noted that the purpose of mid-term access is to provide for additional benefits and relief to members of the Fund before they reach the age prescribed by the law for accessing their full benefits.

Agnes Kunihira, Vice Chairperson Gender Committee while tabling the report yesterday said that the Bill only covers voluntary contributions and should therefore be amended to apply to all contributing members of the Fund, including mandatory contributors.

The Joint-Committee recommends that;- Where the member has not exercised the above benefit, a member may access a mid-term benefit of up to 20% of accumulated contributions including mandatory savings be allowed upon application; a beneficiary must have saved for at least 1O years and attained the age of 45;

While debating on the Committee report, a section of MPs backed the proposal like Angeline Osegge who argued that COVID-10 pandemic has provided an opportunity to think differently and the right to access has to be configured.

“The Fund managers have fears that it will cause problem to Government. The first responsibility to NSSF is to savers not to government. Let this be an eye opener that the situation has to be adjusted,” said Osegge.

Betty Bamukwatsa (Rukungiri Woman) said that the proposal to allow mid-term access is timely to help savers when they are in need.

Lucy Akello (Amuru Woman) said, “The right to access is something important. We shouldn’t just look at situation of COVID-19, but this is something workers have been crying about.”

Gulu Municipality’s Lyandro Komakech said the savers of NSSF are operating under abnormal situations and there is no need for Parliament to hold a long debate on whether they have to access their savings midterm.

He said, “Those most affected are those underemployment of private sector, there are those who lost jobs, they aren’t been supported. It is prudent that social security is defined in contest of simple definition.”

Kenneth Esiangu (Soroti County) welcomed the proposal to allow savers access 20% of their savings saying it would go a long way into helping member’s social security. He also rejected NSSF’s argument that giving out savings would crush the economy saying he is aware of the fact that NSSF gives 40% liquidity and these payments if made wouldn’t drain the Fund.

Susan Amero (Amuria) sought clarification from the Government on how much money NSSF has at the moment before Parliament takes a final decision on the percentage savers can obtain.

She argued, “We want to know clearly if the money is there so we make clear decisions. We can’t determine of percentage unless we know how much is there. I want the Minister to clarify whether there is money to be given out.”


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