NSSF to cut staff to 100
Jul 21, 2011
THE National Social Security Fund (NSSF) is to be restructured as it prepares to remain “robust and relevant†when the pension sector is liberalised.
By David Mugabe
THE National Social Security Fund (NSSF) is to be restructured as it prepares to remain “robust and relevant†when the pension sector is liberalised.
The restructuring will involve reducing its staff significantly to what the managing director described as a leaner organisation.
According to inside sources, the exercise is likely to see the staff reduced from over 500 to about 100, leaving most of the Fund’s activities outsourced.
Top management of NSSF decided on this direction during a retreat recently to review last year’s performance of the Fund, “but more importantly, to agree on strategies for the future of the Fund.â€
“As many of you already know, Parliament earlier this year enacted a law to create a regulator for the pensions market. It is now in the process of debating another Bill that will open up the pensions market to other players. The Bill also requires and calls for a segregation of functions, specifically the Administration, trustee, custodian and fund manager; functions that we, as a Fund, currently handle in-house. The retreat, then, was to discuss and agree on how best we should position the Fund so that it remains robust and relevant in the near future in this changing market place. We are pleased to report that we did agree on some strategic decisions that will significantly change the Fund and position it for a better future,â€
“As required by the law, the Fund will have to be restructured and outsource three of the functions, mentioned above, to independent entities.
The Fund can only retain a single function, implying that the Fund will have to become a leaner organisation,†the MD said in his memo to the staff.
He said there will be significant changes that will impact on all staff.
After the passing of a regulatory Bill this year, Parliament is expected to pass the Uganda Retirement Benefits Authority Bill (URBA) 2011 that will liberalise the pensions sector and usher in a new regime of a competitive pensions sector.
The URBA provides for segregation of functions — it establishes an administrator, fund manager, trustee, custodian and a fiduciary. It is this segregation part of which that will be outsourced.
The new proposal after the sector is opened up also indicates that when a member qualifies for their savings, one-third shall be paid as a lump sum, and the remaining two-thirds shall be used to purchase an annuity, which guarantees a regular lifetime income for the beneficiary.
Charles Muhoozi, the NSSF head of marketing and communications, acknowledged that there will be changes.
“The current staff structure will be reviewed to align it with the requirements of the new law,†he wrote in an e-mail response to this newspaper.
Muhoozi said the issues surrounding transiting from a Provident to a Pension Fund will be addressed when the law, the Liberalisation Bill, is passed by Parliament.
“However, we are cognisant of some of the important things that have to be done, for instance, carrying out an actuarial valuation of the Fund,†said Muhoozi.
THE National Social Security Fund (NSSF) is to be restructured as it prepares to remain “robust and relevant†when the pension sector is liberalised.
The restructuring will involve reducing its staff significantly to what the managing director described as a leaner organisation.
According to inside sources, the exercise is likely to see the staff reduced from over 500 to about 100, leaving most of the Fund’s activities outsourced.
Top management of NSSF decided on this direction during a retreat recently to review last year’s performance of the Fund, “but more importantly, to agree on strategies for the future of the Fund.â€
“As many of you already know, Parliament earlier this year enacted a law to create a regulator for the pensions market. It is now in the process of debating another Bill that will open up the pensions market to other players. The Bill also requires and calls for a segregation of functions, specifically the Administration, trustee, custodian and fund manager; functions that we, as a Fund, currently handle in-house. The retreat, then, was to discuss and agree on how best we should position the Fund so that it remains robust and relevant in the near future in this changing market place. We are pleased to report that we did agree on some strategic decisions that will significantly change the Fund and position it for a better future,â€
“As required by the law, the Fund will have to be restructured and outsource three of the functions, mentioned above, to independent entities.
The Fund can only retain a single function, implying that the Fund will have to become a leaner organisation,†the MD said in his memo to the staff.
He said there will be significant changes that will impact on all staff.
After the passing of a regulatory Bill this year, Parliament is expected to pass the Uganda Retirement Benefits Authority Bill (URBA) 2011 that will liberalise the pensions sector and usher in a new regime of a competitive pensions sector.
The URBA provides for segregation of functions — it establishes an administrator, fund manager, trustee, custodian and a fiduciary. It is this segregation part of which that will be outsourced.
The new proposal after the sector is opened up also indicates that when a member qualifies for their savings, one-third shall be paid as a lump sum, and the remaining two-thirds shall be used to purchase an annuity, which guarantees a regular lifetime income for the beneficiary.
Charles Muhoozi, the NSSF head of marketing and communications, acknowledged that there will be changes.
“The current staff structure will be reviewed to align it with the requirements of the new law,†he wrote in an e-mail response to this newspaper.
Muhoozi said the issues surrounding transiting from a Provident to a Pension Fund will be addressed when the law, the Liberalisation Bill, is passed by Parliament.
“However, we are cognisant of some of the important things that have to be done, for instance, carrying out an actuarial valuation of the Fund,†said Muhoozi.