What you need to know:
- Only savers aged 45 and above, and who have saved for 10 years, will be eligible to get 20 per cent of their gross savings.
President Museveni yesterday endorsed mid-term access for eligible National Social Security Fund (NSSF) members to their savings, ending a protracted and often acrimonious disagreement between workers and Fund management.
Only savers aged 45 and above, and who have saved for 10 years, will be eligible to get 20 per cent of their gross savings, if they so wish, according to a decision of yesterday’s meeting at State House.
Mr Museveni chaired the crunch meeting attended by workers’ representatives, NSSF Board members and managing director Richard Byarugaba as well as Finance Minister Matia Kasaija, the political overseer of the Fund.
Minister Kasaija, like MD Byarugaba, opposed the proposal and after Parliament enacted the provision in the NSSF Amendment Act in February, he wrote advising the President against assenting to it.
The duo claimed that such mid-term access, which lawmakers contrary to initial agreement rendered possible for savers aged 45 or who have saved for 10 years, would vacuum up in excess of Shs3 trillion --- or one fifth of the Shs15 trillion Fund.
However, workers’ MPs alongside leaders of their organisations such as Mr Usher Owere, the National Organisation Trade Unions (Notu) chairman-general, counter-argued that mid-term pay-out would only gross Shs800b to Shs1 trillion.
These disparities, adding to a spirited onslaught by the Fund and its parent Finance ministry, prompted the President to withhold his signature for an additional 2 weeks within which the dissenting parties agreed on mid-term access, but for NSSF members aged 45 and have saved for a decade or more.
Following fresh submissions by the parties at yesterday’s meeting and with Gender and Labour Minister Betty Amongi throwing her weight on the side of workers, President Museveni okayed the mid-term access, a proposal mooted during the first Covid-induced lockdown to salvage struggling workers.
“You remember Shakespeare’s play, The Merchant of Venice? Shylock with his ‘my pound of flesh whether you die or what’! For the NRM not to be that Shylock and since these people (workers) think this is the solution, let’s go ahead.
If it doesn’t work out, we shall see…learn together instead of being like Shylock,” State House quoted the President as having said.
“You go, I wash my hands. I have become Pontius Pilate!” he added, referring to the Bible story of king Pilate against his will capitulating to public demand to crucify Jesus Christ.
Shylock is a fictional character in William Shakespeare’s play, The Merchant of Venice, a Venetian Jewish moneylender. A younger Museveni, while student at Ntare School, acted in the play.
“Though this has taken long, we have achieved the victory…we were worried that this was not going to happen and the workers appreciate His Excellency [the President]. I am really a happy man today,” Notu’s Owere told Daily Monitor by telephone yesterday after striking the deal.
The actual access to the savings by prospective members remains a wait because the President is returning the Act that Parliament enacted for MPs to change the qualification in section 24A from savers aged 45 and above or those who have saved for 10 years, to NSSF members aged 45 or above and have saved for 10 years.
These differing eligibility criteria have varying implications on the number of members and amount to be paid out in mid-term access.
Mr Kiryowa Kiwanuka, the attorney general and chief government legal advisor, who attended yesterday’s meeting, was tasked to oversee the process of effecting the changes to the Act.
“There are some amendments that are being proposed, the workers and the different stakeholders consulted with the President and an agreed position is being taken to Parliament for their consideration... the most touchy [issue] was the acceptance of mid-term access and that is what we are taking back to Parliament,” he said.
Once Parliament agrees with, and enacts the suggested changes, the President has said he will sign the revised NSSF Amendment Act into law, and its commencement date will be set in a statutory instrument.
Mr Museveni said his decision delayed over fears that granting mid-term access would hemorrhage the Fund, diminish its investment capital and returns as well as shrink future interest earnings for members.
NSSF MD Byarugaba disclosed that they collect Shs125b a month, Shs1.5 trillion a year and pay up to Shs900b to qualifying members in other benefits.
Minister Amongi said they had examined different scenarios with mid-term access and established that it would not deplete NSSF resources as claimed by the Fund and Finance officials.
“We agreed to schedule it. We don’t pay all at a go, but about 20 per cent of members in a certain period, and also have [other] criteria like age and amount saved,” she said in relation to about 899,024 members eligible for mid-term access.
Minister Kasaija, a vocal opponent of mid-term access, according to yesterday’s State House statement, said, without providing details, that they had already briefed the President on recommended regulations to govern the intended pay-out.