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Gov't Tables NSSF Amendment Bill

The Bill proposes 29 amendments with the aim of expanding social security coverage through mandatory contributions of all workers regardless of the size of the enterprise or number of workers. It is also seeks to establish a stakeholder board, provide for midterm access to voluntary contributions and enhance fines.
Government Justifies amendments to NSSF Act
The Gender, Labour and Social Development Ministry, has tabled the National Social Security Fund Amendment Bill, 2019 for its first reading.

  The state for Youth and Children Affairs Minister, Florence Nakiwala Kiyingi tabled the Bill before parliament chaired by the speaker, Rebecca Kadaga on Tuesday afternoon.

The Bill proposes 29 amendments with the aim of expanding social security coverage through mandatory contributions of all workers regardless of the size of the enterprise or number of workers. It is also seeks to establish a stakeholder board, provide for midterm access to voluntary contributions and enhance fines. 

Government argues that the NSSF Act 1985 provides that only workers in a company that employs five or more employees are eligible to contribute for their retirement. This government says contradicts 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 Bill proposes to make contributions compulsory for all workers in the formal sector and also allow voluntary contributions for workers in formal and informal sectors. Government also wants to create a stakeholder’s board that comprises government, employers and employee representatives. It also seeks to clearly define the roles of the ministers for social security, finance and public service in the management of NSSF.

  Currently, the 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. 

It adds that the minister shall appoint the chairperson and other board members, other than the managing director for a period of three years and shall be eligible for reappointment. Now, government proposes that the board will among others be empowered to supervise management, introduce new benefits, and advise on investment of scheme funds including lending to government among other functions. 

Government also cites other defects in the NSSF Act including that the   fine of Shillings 10,000 in the Act can no longer serve the purpose for which they were imposed and thereby proposes a fine of Shillings 10 million or one year jail term or both for persons convicted for breaching provisions of the NSSF act. 

The Bill comes months after Workers MP; Dr. Sam Lyomoki was granted leave of parliament to present a private member's Bill to amend the NSSF Act, 1985. In February, Lyomoki claimed that the decade-long delay by government to amend the Act prompted him to move the motion seeking leave of parliament to bring a private member's Bill. 

Lyomoki presented a draft bill, which proposed 30 amendments to the NSSF Act,  such as establishing and enhancing social protection and management framework to achieve efficient and transparent administration of the Fund, streamlining the appointment and tenure of the Board and the right of members to recall Board members.

He proposed to streamline the benefits regime under the Act to provide for others such as maternity, unemployment and other specific benefits and providing for proper management standards for the efficient custody and investment of funds. 

Lyomoki proposed that the board of directors should be made up of five representatives of workers, three representatives of employers and two government representatives. He also proposed to empower the board of directors to appoint the managing director, deputy managing director, secretary, staff and any public officers. These powers are all vested in the minister in the current Act. 

By the time of filing this story, Lyomoki was yet to respond to government's proposed amendments and why he hasn’t tabled a substantive Bill to amend the NSSF Act, five months after getting leave of the House.