Monday June 2 2014

NSSF Act will be outdated, says regulatory boss


The National Social Security Fund (NSSF) Act will soon become obsolete and not applicable in the liberalised pension services sector, whether repealed or amended, an official has said.

Speaking to the Daily Monitor in an interview recently, the Uganda Retirement Benefits Regulatory Authority (URBRA) interim chief executive officer Moses Bekabye said most of the elements that constitute the governance structure of the pension funds, including NSSF, are either in the URBRA Act or will be covered in the liberalisation law, leaving very little for the NSSF Act to stand alone.

“If you are going to bring in more players to operate under the same environment, there should be a level playing field, that’s why we envisage that whether amended or repealed, the NSSF Act will be obsolete within a very short time because it will not be necessary,” Mr Bekabye said.

He added: “If just amended, there will be very little left in the Act to stand alone other than causing confusion. You cannot regulate an entity that has two legislations; it will just cause confusion and in the process compromise the effectiveness of both regulations.”

A report submitted to the ministry of Finance by a taskforce mandated to review the Retirement Liberalisation Bill (where NSSF was part), recommended that the NSSF Act of 1985 be amended, rather than repealing it as is proposed in the Bill, saying the proposed law in its current form carries a narrow mandate and would incapacitate NSSF in a liberalised sector, which does not enhance the spirit of fair competition.

Finance ministry Permanent Secretary Keith Muhakanizi, however, noted that repealing the law could be a good move as it would get rid of the encumbrances in the NSSF Act.

NSSF take on act
NSSF says amending the Act was a recommendation of the 14-person taskforce comprising of URBRA, NSSF, Federation of Uganda Employers, Office of the Solicitor General, ministries of Public Service and Finance and Trade Unions, and was confirmed as acceptable by the Finance ministry.