NSSF welcomes President’s move to widen social security net

By Standard Reporter

Nairobi, Kenya: The National Social Security Fund (NSSF) has welcomed President Uhuru Kenyatta's commitment to provide social protection for all.

President Uhuru, while addressing a joint sitting of the National Assembly and Senate on Tuesday said his government will provide social protection for all.

“We will champion the rights of all Kenyans, preserving and defending them not only through good governance and respect for the rule of law but also by extending the right to social protection,” President Uhuru said.

 “We will expand the state pensions system so that all our citizens enjoy dignity in old age.” The NSSF Managing Trustee, Mr Tom Odongo said a key perspective of the President’s commitment would be a pledge to expand pensions to cover all Kenyans as envisaged in the NSSF Bill 2012.

The Bill is set for presentation and debate in parliament this year. Odongo also affirmed the Fund’s readiness to manage the commitments once the legislative approvals are secured.

The NSSF boss pointed out that the NSSF Bill 2012 seeks to transform NSSF to handle the Social Protection needs for all.

He added that the Bill would enhance coverage and improve on the benefits currently offered to the fund members.

Notwithstanding criticism from occupational schemes and Private pension service providers, Odongo assured that NSSF will seek to incorporate stakeholder views to enable the fund provide an optimum pension cover that meets the needs of all Kenyans.

The NSSF chief executive said failure to provide an expanded social security product under NSSF in coming years would be tantamount to discrimination against various sectors of the economy that are neither covered by NSSF nor by the private schemes.

Tactical move

He clarified that the Bill’s withdrawal was not aimed at antagonising existing occupational Schemes that currently cover about 350,000 people excluding public service schemes.  He said NSSF research justifying the need for the Fund’s transformation had established that only 3.1 per cent of the elderly in Kenya above the age of 55 had reported receipt of any pension.

Odongo said mobilisation of domestic savings would enhance development by participating in key sectors that will also generate employment. “Whereas we appreciate the spirit of the criticism, we are also conscious of the fact that NSSF and the Private schemes cover less than 50 per cent of formal sector employees,” Odongo explained.

 “This means that 80 per cent of employable population is not covered by the NSSF because they are in the informal sector, self-employed, exempted or unemployed.”

He observed that the draft National Social Security Fund Bill, 2012 Bill, which was approved by the Cabinet late last year, had been drawn to address the national social security plight. 

Once the Bill comes into effect, NSSF will have to be competitive enough to retain its members by providing improved services and benefits. The Retirements Benefits Authority will regulate NSSF and ensure that issues of governance, prudent investment and opt-out modalities are addressed.

Public debt eats up 98 per cent of revenue collected in January
Miano pitches Kenya as a strategic partner for Canada
Sci & Tech
Kenyan tech businesses to benefit from new payroll and HR technology initiative
Harambee Sacco shareholders set to pay 12 per cent dividend as its asset base increases