The National Social Security Fund’s move to shut down its old e-collection system and adopt a more advanced tech savvy portal last year coupled with increase in compliance has boosted its capability to collect more employee contributions, according to its Managing Director, Richard Byarugaba.
KAMPALA, UGANDA |ISAAC KHISA| Byarugaba, who was speaking during the NSSF Torch Awards 2017 on July 21 at the Kampala Serena Hotel, said the initiatives have enabled the Fund to hit Shs7.6 trillion in savings.
“The improvement in collections is owed to the fact that our compliance levels have been improving, our collection methodology has been improving; we automated our systems, brought services closer to our members through social media, electronic media, and we think that our members are rewarding us by paying their employee contribution,” he said.
He said NSSF, for instance, collected more than Shs100 billion in contributions from its members in the month of June 2017, the first time that the Fund has collected such huge contributions in a single month. The previous highest amount was Shs 85 billion that was collected in June last year.
However, Byarugaba said the Fund could collect more contributions if the NSSF Act is amended, allowing companies with less than five employees to also contribute towards the Fund.
“The government also needs to give incentives to attract more people to save with the Fund for the betterment of their old-age,” he said. Currently, only 1.7 million Uganda’s out of the country’s labour force of 15.6 million save with the Fund.
Under the current law, only employers with five or more employees are required to remit monthly contributions for their employees within 15 days. Employers deduct 5% of the worker’s salary and top it up with a 10% contribution, remitting the 15% to NSSF.
The money collected is invested in various business ventures including shares on the securities exchange, bonds, equities and real estate.
This development comes at the time a new bill dubbed Pension’s Liberalisation Bill is before parliament seeking to empower workers to choose which pension fund provider is best placed to manage all or some of their mandatory contribution.
However, the National Organisation of Trade Unions (NOTU) is opposed to the Bill arguing that it could be a trick to encroach on workers’ savings.
Prime Minister, Dr. Ruhakana Rugunda, who was the chief guest, said it is time for NSSF to widen the pension coverage so that many people have social security during their advanced age.
“NSSF has a very big role to play towards the development of the country…and only 1.7million people out a population of 35 million means that many of our people remain vulnerable during their old age,” he said.
He congratulated NSSF for coming up with the awards as part of the Fund’s corporate social responsibility to improve the lives of the communities in which they operate, saying government alone cannot meet all the needs of the population.
This was the third time that NSSF was holding the awards in recognition to individuals, organisations and organizations that are transforming their communities and making a positive impact in education, health, youth and other disadvantaged groups.
Child Health Education Empowerment and Rehabilitation Uganda (Cheers) from eastern region was the overall winner of this year’s awards under the health category, and received Shs20 million. Cheers Uganda offers support for rehabilitation of children with physical disabilities.
The other winners included; Kyaninga Child Development Centre from western region, Help Disabled Children Excel (HEDCHE) from Northern Uganda, Atrius Medicare from the central region, with each receiving Shs15million to help in the sustainability and expanding of their activities.
In the media category, Robert Mwanje of BBS TV was the overall winner, walking away with a lap top and a camera, while Malcom Musiime of NTV emerged as the 1st runners-up.
Some of the projects that have previously benefited from this award include 40 Days Over 40 Smiles Foundation, Childcare and Rescues Homes, Youth and Women Empowerment Foundation, and Mbale Maternity Home.