Government tables the NSSF Bill

The National Social Security Fund Amendment bill has on Tuesday 14th August 2019 been table into the floor of parliament for its first reading.

The bill was tabled by State Minister for Youth and Children Affairs, Florence Nakiwala Kiyingi on the session chaired by speaker Rebecca Kadaga today afternoon.

The bill aims at providing midterm access to voluntary contributions and enhancement of fines. The bill which includes 29 amendments also aims at expanding social security coverage through mandatory contributions of all workers regardless of the size of the enterprise or number of workers.

The bills also emphasizes at creating create a stakeholder’s board that comprises government, employers and employee representatives.

According to the NSSF Act of 1985, only workers in a company that employs five or more employees are eligible to contribute for their retirement.

However, the Government of Uganda says that this contradicts with the National Objectives of Directive Principles of State Policy in the 1995 Constitution and the International Labour Organisation Convention 102 on social security among other laws and treaties that Uganda subscribes to.

The Government also sees deficiencies in the NSSF act of 1985 and insists that Act “doesn’t make express provision for the representation of workers, employers and other stakeholders on the NSSF board of directors”

The NSSF Act states that the governing body of NSSF shall be the board, consisting of a chairperson, the managing director and not more than eight other members appointed by the minister for Finance.

The Bill seeks to amend the National Social Security Act:

(a) to provide for the appointment of a stakeholder board appointed by the Minister comprised of representatives of Government, employers and employees;

(b) to clearly specify the different roles of the Ministers responsible for social security, finance and public service in the management of the Fund;

(c) to expand social security coverage by providing for mandatory contribution of all workers regardless of the size of the enterprise or number of employees and also allowing voluntary contributions to the Fund;

(d) to empower the Fund to recover from a third party any sum owed to a defaulting contributing employer to cover any contribution, penalty or interest;

(e) to provide for midterm access to voluntary contributions;

(f) to provide for the deference of taxes on contributions and scheme income to the time of payment of benefits;

(g) to provide for the appointment of the Managing Director and Deputy Managing Director by the Minister on the recommendation of the board for a term of five years renewable on satisfactory performance;

(h) to provide for the appointment of the Secretary to the board on a five year contract renewable on satisfactory performance;

(i) to empower the Minister to prescribe a threshold of expenditure by the Fund prior to approval of the annual budget by statutory instrument;

(j) to empower the board to use in house expertise and fund managers in the investment of scheme funds including lending to Government;

(k) to empower the board to introduce new benefits rn consultation with the Minister; 0) to provide for payment of an annual levy by the Fund to the Uganda Retirement Benefits Regulatory Authority; and

(m) to enhance fines in the Act.