Parliament is set to approve the proposal in the National Social Security Fund Amendment Bill, 2021 that will allow members access at least 20% of their mid-term savings within two months after the law is gazetted.
Clause 24 (a) of the Bill requires that targeted beneficiaries will only get their savings 60 days after the law is gazetted to allow the Ministry of Finance, Planning and Development draft regulations that will guide how members will access their savings in the mid-term.
According to the Minister for Gender, Labour and Social Development, Betty Amongi, the regulations will among others spell out what percentage each category of qualifying members will get off their total savings, depending on their socio-economic needs and standing at a given time.
She explained that not all members aged 45 who have saved for at least 10 years will qualify for the same amount of mid-term access because some, at that age, are still in gainful employment and in good socio-economic standing therefore, the resources meant for their retirement might not be as necessary.
The lawmakers also said that the 60-day timeframe will do away with any form of delays that savers might interface in case the law is passed but Authorities are not yet ready to payout.
However, efforts by Dokolo Woman MP, Cecilia Ogwal to set timeframes on when the gazetting and drafting of regulations should take place to avoid deliberate delays, were futile.
While debating the report of the Committee on Gender, Labour and Social Development on the Bill on November 23, 2021, the MPs were expressed readiness to vote for persons above 45 years old and who have saved for over 10 years to access 20% of their savings but the decision was deferred to November 24, 2021 due to time constrains.
The NSSF Bill that was first passed by the 10th Parliament on February 17, 2021, before it was returned to the House by President Yoweri Museveni, seeks to among others allow mid-term access of up to 20 per cent to members who have reached the age of 45 years and above and also seeks to streamline the supervision of the Sh15 trillion NSSF Fund.
In the new arrangement, MPs rejected President Museveni’s proposal to put NSSF under the supervision of the Ministry of Finance and instead shifted the overall supervision to the Ministry of Gender, Labour and Social Development while overseeing the investment and audit aspect of the Fund was left to the finance ministry.
The supervisory role of the Ministry of Gender includes mobilizing and empowering communities to harness their potential while protecting the rights of vulnerable population groups and promoting issues of labour productivity and employment.
The 10th Parliament had voted that the Ministry of Finance retains the supervisory role of the Fund following the President’s rejection of dual supervision saying it was causing delays in decision making.
Amongi, noted that under the international standards, the Social Security funds are supposed to be under the Minister in charge of Labour.
The Gender Committee Chairperson, Flavia Kabahenda was concerned that placing social security under the supervision of the Ministry of Finance would compromise the effective running of the scheme.
She was confident that the Fund would still grow even when placed under the Ministry of Gender. She called for a concerted effort by the respective Ministries to support the Fund.
“The Ministry of Finance is ably represented on the board of directors of NSSF and the entire retirement benefits sector and has a say in how the finances and investments of NSSF are handled,” said Kabahenda.
The majority of the legislators including Attorney General Kiryowa Kiwanuka supported the idea of placing supervision of the Fund under the Ministry of Gender.
Budadiri West MP, Nandala Mafabi however, called for the streamlining of the roles of the two ministries in managing NSSF.
“We need to put interpretations clearly stating what each minister is supposed to do. You recall that the Ministry of Finance first took over this Fund because they were looking for money and yet they had no role,” said Nandala.
There was contention over Clause 7 in the amendment (insertion on Section 13 A of the Principal Act) which provides that an employer who deducts voluntary contributions and fails to remit the contribution to the fund commits an offence and is liable, on conviction, to a fine not exceeding one thousand currency points or imprisonment not exceeding three years or both.
MP Jonathan Odur (Erute South) was concerned that the fine and the imprisonment sentence were not in tandem as provided by the law revision (fines and other financial amounts in criminal matters) Act 2008
The House stood over that specific clause to allow the Minister to harmonize the said concern and report back to Parliament on November 24, 2021 at 11:00 Am.