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Public Service Pension Fund marks new dawn
The new fund will be governed under modern principles of transparency, accountability and professional management. It will have a board of trustees, professional fund managers, custodians, administrators, actuaries, auditors and other service providers.
Public Service Pension Fund marks new dawn
By: Admin ., Journalist @New Vision
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OPINION
By Catherine Bitarakwate Musingwiire
For decades, public servants have served the country with the assurance that, upon retirement, the Government would provide a pension as a constitutional obligation and as a matter of social justice. That commitment remains firm. What is changing is the manner in which that promise will be financed, managed and protected for the future.
The Public Service Pension Fund (PSPF) is, therefore, not merely another institutional reform. It is a national assurance to teachers, health workers, administrators, local government staff, police and prison officers covered under the public service arrangements and many other public officers who have carried the responsibilities of the State. It is a promise that retirement should not be a season of uncertainty, delayed payments, repeated follow-ups and anxiety. It should be a dignified transition into a secure life after service.
The old pension system, which has served the country for many years, was designed as a non-contributory, pay as-you-go arrangement. Under that model, pensions were paid directly from the Consolidated Fund through annual budget allocations. While this arrangement reflected government’s commitment to its workers, it has increasingly come under pressure due to a growing public service, salary reforms, longer life expectancy, accumulated arrears, records challenges and increasing pension and gratuity obligations.
These realities demanded a bold, but carefully managed reform. The Public Service Pension Fund Act, 2025, provides that new foundation. It establishes the Public Service Pension Fund and the Public Service Pension Scheme to collect contributions, manage retirement benefits, invest funds prudently and pay pensions in a more predictable and sustainable manner. Under the new arrangement, the Government will contribute 10% while the employee contributes 5%, making a total contribution of 15%.
This shift should be understood positively. It is not a withdrawal of government responsibility. On the contrary, it is government taking deliberate action to strengthen, protect and modernise the pension promise. The reform ensures that pension resources are built up in advance, professionally managed and available when benefits fall due. This is what will make timely and predictable payment possible.
A major concern among public servants and pensioners has been whether the reform affects rights already earned under the old system. The answer is clear: Accrued pension rights are protected. Existing pensioners will continue to be paid by government under the applicable legal framework. Public officers who have already earned benefits under the old scheme will have those rights preserved, including through retirement bonds as provided under the Act. Employees nearing retirement are also catered for under transitional provisions.
The reform is being implemented with sensitivity because government recognises that pension is not just a financial matter. It is emotional, personal and family-based. It affects school fees, medical care, family welfare, housing, food security and the confidence with which a public officer approaches retirement. That is why the Ministry of Public Service, working with key institutions including the finance and justice ministries, Uganda Retirement Benefits Regulatory Authority (URBRA), Bank of Uganda, National Social Security Fund, NITA-U and other stakeholders, is taking a structured approach.
The old pension system, which has served the country for many years, was designed as a non-contributory, pay as-you-go arrangement. Under that model, pensions were paid directly from the Consolidated Fund through annual budget allocations. While this arrangement reflected government’s commitment to its workers, it has increasingly come under pressure due to a growing public service, salary reforms, longer life expectancy, accumulated arrears, records challenges and increasing pension and gratuity obligations.
These realities demanded a bold, but carefully managed reform. The Public Service Pension Fund Act, 2025, provides that new foundation. It establishes the Public Service Pension Fund and the Public Service Pension Scheme to collect contributions, manage retirement benefits, invest funds prudently and pay pensions in a more predictable and sustainable manner. Under the new arrangement, the Government will contribute 10% while the employee contributes 5%, making a total contribution of 15%.
This shift should be understood positively. It is not a withdrawal of government responsibility. On the contrary, it is government taking deliberate action to strengthen, protect and modernise the pension promise. The reform ensures that pension resources are built up in advance, professionally managed and available when benefits fall due. This is what will make timely and predictable payment possible.
A major concern among public servants and pensioners has been whether the reform affects rights already earned under the old system. The answer is clear: Accrued pension rights are protected. Existing pensioners will continue to be paid by government under the applicable legal framework. Public officers who have already earned benefits under the old scheme will have those rights preserved, including through retirement bonds as provided under the Act. Employees nearing retirement are also catered for under transitional provisions.
The reform is being implemented with sensitivity because government recognises that pension is not just a financial matter. It is emotional, personal and family-based. It affects school fees, medical care, family welfare, housing, food security and the confidence with which a public officer approaches retirement. That is why the Ministry of Public Service, working with key institutions including the finance and justice ministries, Uganda Retirement Benefits Regulatory Authority (URBRA), Bank of Uganda, National Social Security Fund, NITA-U and other stakeholders, is taking a structured approach.
The new fund will be governed under modern principles of transparency, accountability and professional management. It will have a board of trustees, professional fund managers, custodians, administrators, actuaries, auditors and other service providers. It will be regulated by URBRA, audited by the Office of the Auditor General and subject to oversight by Parliament.
Another important benefit is that the reform will improve records management and service delivery. Pension administration has historically suffered from incomplete records, manual processes and delays in verification. The Fund will be supported by modern systems linked to relevant government platforms to improve accuracy, reduce delays and support faster processing of benefits. Responsible officers in ministries, departments, agencies and local governments will play a central role in ensuring that member records, contributions, payroll changes and retirement documentation are submitted accurately and on time.
The PSPF will also have wider benefits for the country. Pension funds are an important source of long-term national savings. Government is aware that reforms of this nature naturally raise questions. Will salaries reduce? Will current pensioners lose benefits? Will past service be ignored? Will the fund be safe? These are legitimate questions. The answer is that the reform has been designed to protect rights, promote fairness, preserve accrued benefits, strengthen governance and ensure continuity. Sensitisation of stakeholders is ongoing and will continue across institutions and regions so that every public officer understands the reform and participates from a position of knowledge, not fear.
To every public servant, the message is one of assurance: Your service matters, your pension rights are protected, and the reform is intended to secure your future. To every pensioner, the Government’s commitment to honouring earned benefits remains unchanged. To the country, the Public Service Pension Fund is a responsible step towards sustainable public finance, stronger social protection and a more dignified retirement system. As government, we are determined to deliver this reform carefully, transparently and inclusively. The Public Service Pension Fund is not simply about contributions.
The author is the Permanent Secretary, Ministry of Public Service
Another important benefit is that the reform will improve records management and service delivery. Pension administration has historically suffered from incomplete records, manual processes and delays in verification. The Fund will be supported by modern systems linked to relevant government platforms to improve accuracy, reduce delays and support faster processing of benefits. Responsible officers in ministries, departments, agencies and local governments will play a central role in ensuring that member records, contributions, payroll changes and retirement documentation are submitted accurately and on time.
The PSPF will also have wider benefits for the country. Pension funds are an important source of long-term national savings. Government is aware that reforms of this nature naturally raise questions. Will salaries reduce? Will current pensioners lose benefits? Will past service be ignored? Will the fund be safe? These are legitimate questions. The answer is that the reform has been designed to protect rights, promote fairness, preserve accrued benefits, strengthen governance and ensure continuity. Sensitisation of stakeholders is ongoing and will continue across institutions and regions so that every public officer understands the reform and participates from a position of knowledge, not fear.
To every public servant, the message is one of assurance: Your service matters, your pension rights are protected, and the reform is intended to secure your future. To every pensioner, the Government’s commitment to honouring earned benefits remains unchanged. To the country, the Public Service Pension Fund is a responsible step towards sustainable public finance, stronger social protection and a more dignified retirement system. As government, we are determined to deliver this reform carefully, transparently and inclusively. The Public Service Pension Fund is not simply about contributions.
The author is the Permanent Secretary, Ministry of Public Service