Gov''t withdraws retirement benefits bill

By Norman Katende

State minister for Labour, Employment and Industrialisation Mwesigwa Rukutana has ordered that the proposed Retirement Benefits Sector Liberalisation bill 2011, that had already been presented to parliament be shelved to allow more consultations with the stake holders.

The move follows a heated debate at Imperial Royale Hotel during the third consultative meeting about the bill, where workers' representatives, NSSF officials and  trade unionists argued that  their input in the bill was not captured.

Rukutana directed the  Gender ministry Permanent secretary,  Pius Bigirimana, to chair the new committee that will have representatives from the two  national trade centres, employers, Public service, the Attorney General's office and National Social Security Fund and report back to him April 3 on the way forward.

Keith Muhakanizi, the finance planning and economic development permanent secretary conceded that there were loopholes and agreed that they need to do more research before announcing the way forward.

“After these presentations, I would  like to say that unless one does not have Uganda at heart, there is no way  you can accept that we go forward with this bill in this current form,” he said, after NSSF’s  Patrick Kayota had  made a presentation on why the new bill spelt disaster instead of improving  on the social security sector in the country.

“The big question is, does the bill enhance the security, coverage and effectiveness of the pension sector and the answer is no. It is instead trying to strip NSSF but without giving an alternative,” said Kayota after a 15 minute presentation by Geraldine Ssali Busulwa, the NSSF acting managing director who took the meeting  through the performance of NSSF, which he said has been making profits and called upon government to improve the NSSF Bill other than bringing an entirely new law.

Kayota said that NSSF is being required by law to pay a minimum of 2.5% profits for the deposits but the new bill has no guarantee on this.
Kayota challenged the talk that private companies will build competition and hence improve services.

“That is out. Do you want to tell us that URA, KCCA and UPDF have been effective because they have been liberalised or because of good management and delivery of services. Everybody here knows the answer,” he said amidst   clapping from the full hall.

He said that what the ministry needed to do was to improve the NSSF Bill, amend the law so that they can offer more products and also government should start borrowing from them instead of borrowing from out.

He also said that NSSF does not need a fund manager as they have been able to manage their fund internally. “Why should we pay someone sh2bn to manage our funds as if we are making losses?” he asked.

Kayota said that while other countries are consolidating their social security programmes, the bill has chosen to fragment it and has also not included the public service,” he summed before being given a standing ovation.

“We have to withdraw it and consult further,” Muhakanizi said after the speech, bringing the meeting that had been set to end at 2pm to a premature close at 10.25am. He had earlier said that the reforms were aimed at building trust and benefits in the sector and asked the members to go on and discuss the amendments.

“In this current Uganda, if someone accepts to he made a mistake, we should be proud of it. Let us start a new chapter and make sure that   we have a report for the way forward. Since the Bill is now a property of parliament, we cannot withdraw it but when the report comes out, we will be able to address this,” said Rukutana.

Bigirimana promised a good work that will be able to profit all sides, mostly the beneficiaries, who are the people with the funds in NSSF.