ENTEBBE – President Yoweri Museveni has agreed that workers should have mid-term access to their savings. In a meeting held at StateHouse Entebbe last evening, Museveni directed the Minister for Gender, Labour and Social Development Hon. Betty Amongi to make changes to the bill and return it for consent.
The President noted that if the idea does not work out, it will be a lesson learned together.
“You remember Shakespeare’s play The Merchant of Venice? Shylock with my pound of flesh whether you die or what! For the NRM not to be that Shylock and since these people think this is the solution, let’s go ahead. If it doesn’t work out, we shall see. Learn together instead of being like Shylock,” the President said.
In detail, it has now been agreed that somebody who is 45 years and has saved for ten years can access up to 20% of their savings. The commencement date will be set in the statutory instrument; supervision of the fund is a mandate of the Ministry of Finance, while the NSSF Managing Director is a member of the Board of directors.
The earlier conflicting information and change in wording regarding the National Social Security (Amendment) bill forced the President to postpone a major decision on the workers’ mid-term access to the current date.
The workers’ representatives from the Ministry of Finance led by Minister Matia Kasaijja, the Managing Director of NSSF Richard Byarugaba, members of NOTU and COFTU attended the meeting.
The President said he was more concerned about destroying the viability of the fund.
“The fear was if you do that, you degrade huge money put together and which the fund is using to invest instead of going abroad to beg. Also, a worker may end up getting less by 30 million at his retirement,” he said.
According to Byarugaba, the fund collects 125 Billion Shillings a month, 1.5 Trillion Shillings per year and pay up to Shs 900bn for members qualifying in other benefits.
However, Minister Amongi said they had delved into all the issues and they concluded that it would not have a substantial impact on the depletion of the fund because the fund is Shs 15 trillion and they need between Shs 800bn to 1 trillion to handle mid-term access at a go.
“We agreed to schedule it. We don’t pay all at a go but about 20% of members in a certain period and have also had a criterion like age and amount saved,” she said.
The Minister of Finance Matia Kasaija said they had already done a brief to the President on how they are going to handle this including the formation of regulations that will govern the way the money will get out.
NOTU Chairman General Usher Owere commended President Museveni for the bold decision and thanked him on behalf of workers of Uganda for listening to their plight.
“Workers are very happy with you. You have saved this country and workers will never forget you. I thank the workers for being patient,” he said.
Every month, institutions deduct 5% of employees’ salaries as a contribution to NSSF, the employers top it up with 10 per cent while NSSF earns them 12%.
NSSF is a government agency responsible for the collection, safekeeping, responsible investment and distribution of retirement funds from employees in the private sector who are not covered by the government retirement scheme.