NSSF of Uganda is not the best pension fund in Africa & more work is needed to improve it
The management of NSSF cannot deceive the people of Uganda that it is doing well when we have 200 Billions of uncollected workers money NOT remitted to NSSF.
By Matua Job Richard
Many commentators and some political, economic & social analysts have been over the moon making statements to the effect that NSSF is doing wonders and that it is the best pension scheme.
This argument is equally echoed by some academia including the likes of Prof Baryamureba Veracious and my good friend Dr Muhumuza Fred of Makerere University.
The facts in terms of statistics speak to the contrary.
The figures are equally bad for Africa. Social Security is still a luxury for the majority of the African population.
Only 9.6% of Africa’s working population is contributing to pension schemes, with 6.3% in Sub-saharan Africa and 19.9% in North Africa.
75% of the African population lacks access to effective statutory health insurance.
80% of African women giving birth do not get maternity cash benefits although Ghana and Rwanda have introduced maternity insurance schemes.
Selected Countries in Africa with pension schemes as a percentage of their GDP.
- Namibia: Has social security fund worth 11.8 Billion US dollars, making 103% of the GDP of the Country.
- Nigeria: Has social security fund worth 32.6 Billion US dollars making 7.6% of the GDP of Nigeria.
- Uganda with NSSF worth 5.3 billion of US dollars which is 12.4% of our GDP.
Top eight Countries in the World with best Pension Funds in 2022.
- Iceland
- Netherlands
- Denmark
- Israel
- Finland
- Australia
- Norway
- Sweden.
Top eight Countries in the World with high ranks of Social Security Funds.
- Japan with social security fund worth 1.7 trillion US dollars.
- Norway with social security fund worth 1.4 trillion US dollars
- South Korea with social security fund worth 798.0 Billion US dollars.
- USA with a combined social security fund worth 1.3 trillion US dollars
- Netherlands with social security fund worth 630.4 Billion US dollars.
- Canada with social security fund worth 426.7 billion US dollars
- China with social security fund worth 406.8 billions US dollars.
- Singapore with social security fund worth 375 billion US dollars.
Uganda’s working age population and the statistics for their contribution to NSSF.
Currently, Uganda has a population of about 22 million people working age group.
Some of these people work with Government and are covered by different Pension Scheme. These are called Civil Servants and they include teachers/lectures/tutors/instructors in public Institutions of learning.
Majority of Uganda’s working age group is employed by private sector and others self employed. This constitutes a population of about 17 million people.
NSSF is only having in its data base 1.33 million people out of the 17 million people.
Only 630,000 people are actively saving Monthly with NSSF . The rest have dormant accounts and are no longer contributing Monthly.
This is a National Disaster in waiting. To have only 10% of our working population saving with NSSF is something that cannot be celebrated as a big success. It is actually mediocre performance to say the least.
Therefore, the people misleading others that NSSF is doing well should reflect deeply on these ugly statistics. Numbers don’t lie.
There is real need to expand the fund from the current 1.33 million members/savers to the targeted 15 million savers by 2025 .
In my view this should constitute major part of the strategic goal of NSSF management along aside wise investments of members savings to earn much better interests than the paltry 9.46 to 12% they always give us.
Compliance of remittances of contributions of NSSF.
We only have compliance of 51% meaning 49% of the companies and farms or factories or Institutions in which our people are working are NOT paying NSSF contributions to the fund even when they are registered.
The management of NSSF cannot deceive the people of Uganda that it is doing well when we have 200 Billions of uncollected workers money NOT remitted to NSSF.
UBC alone has 48 Billions unpaid NSSF contributions.
NB: In my next article, I will explain the importance of social security fund to the savers and to the economy of a Country like Uganda, drawing examples from Asian Tigers like South Korea, Singapore, Taiwan, Hong Kong etc whose social security funds are 30% of their GDP.
Matua Job Richard – @job_matua (on Twitter) – Is an Award Winning Pan-Africanist and aspirant for National Vice Chairperson Central Executive Committee NRM Northern-Uganda.
