By Andrew Irumba
The Minister for Gender, Labour and Social Development Frank K Tumwebaze has proposed an amendment of the National Social Security Fund (NSSF) Act, so that Ugandans can be able to access part of their savings before they clock retirement age.
Minister Tumwebaze revealed this to Parliament on Thursday when he told legislators that Cabinet has considered amending the NSSF Act to allow members have mid-term access to their money.
The Minister made the revelation while delivering his speech during the ‘Scientific’ celebrations of the International Labour Day held at State House Entebbe, which was presided over by President Yoweri Museveni.
Tumwebaze’s remarks came at a time when several Ugandans are angry with NSSF officials for denying them partial access to their savings following the issuance of government directives requiring people to stay home due to the Coronavirus pandemic, yet many of them didn’t have money to buy food.
The Minister
said the NSSF amendment bill by Cabinet is already before Parliament and seeks
to widen benefits of the Fund to its members.
“You Excellency, you might have heard from the media a lot of debate with many people calling upon NSSF to do something with their benefits. NSSF of course cannot do anything outside the law but I would like to inform you and the country that Cabinet already discussed the possible amendments to the NSSF Act, the workers had their input as well and the NSSF bill now stands before Parliament,” Tumwebaze said. (lakeforestgc.com)
He added that; “It seeks to widen the benefits – unemployment benefits, others like medical and also provides for midterm access of the benefits, but of course that is proposed without compromising the principle of social security because some people would want to turn social security fund into an emergency fund, that will compromise the International principle of social security.”
He said people
who have been calling upon NSSF to act during the COVID-19 crisis should know
that the Fund cannot act outside the law, adding that the public will get an
opportunity to go to Parliament and give their views on the amendment.
“We hope
Parliament will discuss the bill and members of the public or stakeholders go to
Parliament and present their views because at the end of the day we want a law
that is for the workers but at the same time following and still upholding the
principles of social security as we know them internationally,” Tumwebaze
explained.
It should be
noted that following the demands from Ugandans to NSSF to act, the Fund’s Managing
Director Richard Byarugaba issued a statement
in which he assured the nation that the Fund had no legal basis to allow partial
payment to its members.
Byarugaba
explained that if the fund took a decision to pay members a portion of their
savings, government would have to buy back its bonds to raise liquidity, because
80% of the Fund’s assets are invested in
Government Treasury Bonds. He warned that buying back of the treasury bonds would affect
the economy.
“This would leave government short of locally
mobilised funds for its social and economic intervention, which would have a more
devastating effect on the economy in the long term,” Byarugaba’s statement read
in part.
He also
noted that there is lack of a legal basis to make partial payments saying; “The
Fund has no legal basis upon which to make adhoc payments as being suggested.
NSSF is a social security scheme, created to provide a safety net for members
in case of old age, permanent incapacitation or for dependents in the event of
death of a member. The current pandemic does not meet any of the above
criteria.”
However, it is this standoff between NSSF and members who have saved billions of shillings with the Fund but can’t access the money that government seeks to eradicate by amending the NSSF Act.
