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NSSF seeks to recover Shs160bn from ‘defaulting’ employers

 

FILE PHOTO: NSSF Managing Director Richard Byarugaba

Kampala, Uganda | JULIUS BUSINGE  |  The National Social Security Fund (NSSF) is seeking to recover over Shs160 billion following the announcement of a grace period of three months for all employers that have not remitted employees’ social security contributions to agree a payment plan.

In exchange, the Fund will waive up to 95% of the penalty amount owed, the NSSF Managing Director Richard Byarugaba said in a notice dated Feb.11.

According to the notice, 10,839 out of more than 33,270 employers that are registered with the Fund have not paid NSSF contributions in a period ranging from two months up to seven years thereby denying their employees social security protection.

Byarugaba said that although it is the obligation of every employer to pay social security contributions for their employees on a timely basis and the correct amounts, the Fund recognises that for various reasons, some employers may be unable to remit funds on a regular basis.

“…eventually they get overwhelmed by the arrears and penalties levied on unremitted funds,” he said. Section 14 (2) of the NSSF Act empowers the Managing Director to waive “whole or part of any penalty subject to such conditions as he or she may determine.”

Byarugaba added that using a similar approach, the Fund has already recovered about Shs13.7 billion since July 2017 from 380 employers who came forward and signed Deeds of Settlement.

Byarugaba said that employers that do not take advantage of the Amnesty window risk court action to recover the arrears, the penalty and interest accrued.

Information available from the Fund indicates that 174 employers have been arraigned before courts of law and over Shs17.8 billion has been recovered in the process.

The Fund, as at end of December 2018, was worth Shs10.2trillion up from Shs8.7 trillion in December 2017.

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