A section of MPs is working on a motion to push Parliament to fast track the passing of the NSSF (Amendment) Bill which was shelved after a disagreement two Parliamentary committees that were scrutinizing it.
Led by Busongora MP William Nzoghu, the legislators want the law to be changed to allow contributors to the National Social Security Fund (NSSF) to access a porting of their savings to go through the hard times caused by the COVID-19 shutdown.
The current legal framework only allows members to access their savings upon clocking 55 years of age or when they suffer from permanent incapacity or emigrate permanently from Uganda. But Nzoghu says that contributors need to access part of their savings as a bailout from the COVID-19 crisis.
He argues that the Covid-19 guidelines issued by the government although necessary, have heavily impacted industrial production, sales and investments and resulted in the lay-off or non-payment of emoluments of employees and has generally affected the performance of the economy.
“Most of the NSSF contributors have no access to an alternative source of income, cannot borrow from financial institutions since they don’t have security to guarantee such borrowing and saved with the NSSF, under the reasonable belief that the Fund will act as their social security net during times of uncertain economic environment,” Nzoghu’s motion reads in part.
Workers MP Dr. Sam Lyomoki recently moved an amendment to the NSSF Act to allow mid-term access to the savings by members. In the amendment, still before Parliament’s Finance Committee, Lyomoki says that the motion will partly seek a directive for the committee report on the amendment to be presented so that parliament comes up with legislation to help the savers.
He said that they are looking at savers accessing only 20 percent of their savers before the mandatory retirement age.
“We are trying to provide for what is called mid-term access but it does not mean that everyone will be able to access [the savings], it will depend on the available resources, the liquidity,” Lyomoki said.
Asked whether the process will not take a long time for savers to receive their money amid the COVID-19 crisis, Lyomoki said that the only legitimate process is through amendment of the law.
“A resolution of Parliament cannot amend the law, already the NSSF Act provides for full benefits. We shall pass a resolution and invoke our Parliamentary procedures so that the [amendment of] the other law is expedited,” he added, further saying that, “The good thing is that we had [gone through] the processes. It was remaining with the second and third reading and one day is enough for that.”
John Baptist Nambeshe (Manjiya) said that the Fund is supposed to help members in times of need and not only concentrate on the age requirement. He said that NSSF members are currently distressed by a coronavirus and that they should enjoy the protection of the Fund.
He said that the Minister of Gender is mandated by the NSSF Act to make regulations to covert the benefits into installment or periodic payments in times of need.
Nambeshe adds that provision of savings to members before the mandatory 50 years is not a favour since they have a right to access their funds.
Currently, NSSF has about 1.5 million members who contribute to the Fund every month and has an asset base of about Shillings 11.3 trillion. The Fund receives about Shs 1.028 trillion in members’ contributions annually.
In August last year, former Labour, Gender and Social Development Minister, Janat Mukwaya tabled before Parliament a bill titled, the National Social Security Fund (Amendment) Bill, 2019 to among others, expand social security coverage and benefits through enforcing mandatory contributions for all workers in the formal and informal sectors, provide for midterm access to benefits and taxing of benefits for savers who withdraw their savings before attaining 50-years.