The chairman of the National Social Security Fund has revealed that the fund has the money to pay its members who’ve reached 45 years, at least 20% of their savings.
Speaking at a Members meeting on Monday September 28, at Sheraton hotel in Kampala, Patrick Byamukama Kaberenge, confirmed that NSSF can afford to pay out 20% to the members once the controversial amendment to the NSSF Act, is passed in Parliament.
Last week, Parliament approved several clauses to the law including one that allows member to access at least 20% of their savings once they reach 45 years or have saved with the fund for at least 10 years.
The so called mid-term access has been a sticky issue since the amendment came to Parliament last year.
The financial crisis that was brought about by the COVID-19 pandemic, which left many people jobless, amplified calls for midterm access as ex-savers sought solutions to restart new lives.
Kaberenge said passing the provision on midterm access would make the fund to be more flexible and relevant to the needs of its members.
“Amendment of the NSSF Act remains our biggest challenge. We appeal to the Minister of Finance to push for the bill in Parliament to be concluded so that we can be more flexible to our members,” said Kaberenge.
Although MPs approved the midterm access provision, they fell short of fixing the percentage, and left it open for NSSF management to look into it’s coffers to determine the feasible level of access.
Workers advocates argue that NSSF has the UGX600bn it requires to pay out the 20% of savers money if they so wish.
The government had earlier rejected midterm access, on grounds that it would put the fund into a crisis.
But unprecedented pressure appears to be yielding results and is likely to force the government to give the proposal the green light.
NSSF is the biggest financial institution in Uganda with over US$3billion in assets. The fund is the biggest lender to government through purchase of treasury bonds and treasury bills.
The fund however invests heavily in Kenya and other countries, which has led some to demand that instead of borrowers going to banks for expensive loans, it’s better they access part of their NSSF savings while they are still energetic.