NSSF seeks to be a pension scheme
Posted Monday, October 5 2009 at 14:08
The National Social Security Fund is seeking to transform itself into a pension scheme if Parliament approves a proposal before it.
Once given the nod, retirees will now withdraw their benefits, spread over several years, in bits.
Presently, NSSF operates as a provident fund with contributors receiving a lump sum payment upon retirement.
This mode has in the past been criticised because most retirees squander their lifetime savings and end up spending their sunset days in squalor.
Managing trustee Alex Kazongo said that a paper had already been submitted to the House to amend the NSSF Act to herald the transformation.
He said that the proposed amendment would also affect the minimum number of workers that an employer must have to contribute to the fund.
“The amendment to the current Act will allow employers with less than five workers to contribute for them so that their future is secured,” said Mr Kazongo.
He said that a campaign has been launched to register as many members to the fund as possible.
Towards this end, Mr Kazongo said, several products including voluntary membership to cover workers in the informal sector and top up schemes for those in permanent employment, have been introduced.
“I envisage a fund that will attract members not because of the legal requirements but because of its economic viability, efficiency of services and competitiveness” said the managing trustee.
Mr Kazongo said that several strategies, embodied in its corporate strategic plan 2009-2012, would be rolled out to improve its services.
He spoke at the Tom Mboya Labour College in Kisumu at the weekend during a meeting of secretary generals of trade unions affiliated to the Central Organisation of Trade Unions.
Trade union leaders urged NSSF to invest in low-cost housing for the benefit of members whose income is poor.