Workers delighted as Museveni okays NSSF mid-term access

The National Organisation of Trade Unions (NOTU) has welcomed the President’s endorsement of the mid-term access to savings with the National Social Security Fund (NSSF), saying this is a landmark decision that will improve workers’ welfare in the country.   

On Wednesday, President Museveni agreed to the workers’ mid-term access after an intense debate between the top management of NSSF and Workers’ representatives.

And in response, NOTU Chairman General Usher Owere commended Mr Museveni for listening to the workers’ plight.

“Workers are very happy with you. You have saved this country and workers will never forget you. I thank the workers for being patient,” he said.

Every month, institutions deduct 5% of employees’ salaries as contribution to NSSF, the employers tops it up with 10 percent while NSSF earns them 12%.

During the Wednesday meeting at State House, Mr Museveni directed Minister for Gender, Labour and Social Development Betty Amongi to make changes to the NSSF Bill and return it to him for consent.

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The call for mid-term access came last year at the height of the outbreak of COVID-19, with many workers urging NSSF to pay it’s members 20% of their accumulated balances to enable them to meet their expenses.

The President’s decision means that somebody who is 45 years and above and has saved for ten years with NSSF can access up to 20% of their savings.

But the President on Wednesday noted if this does not work out, it will be a lesson learned together.

“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 think this is the solution, let’s go ahead,” said Museveni.

“If it doesn’t work out we shall see..learn together instead of being like shylock,” the President said, adding, “You go, I wash my hands. I have become Pontius Pilate!”

The President said he was more concerned about destroying the viability of the fund.

“The fear was if you do that, you degrade huge money put together and which the fund is using to invest instead of going abroad to beg. Also a worker may end up getting less by Shs 30 million at his retirement,” he said.

According to the NSSF MD Richard Byarugaba, the fund collects Shs 125bn a month, Shs 1.5trillion per year and pay up to Shs 900bn for members qualifying in other benefits.

Byarugaba argued that each worker saves for between 25 – 30 years and earns Shs 150m.

He said if they access their savings now, they lose up to Shs 30m in 20 years. 

Byarugaba also said the fund would lose money because it would offer securities at a discount in a fire-sale.

However, Minister Amongi Betty said they had delved into all the issues and their conclusion is that, it would not have a substantial impact on the depletion of the fund because the fund is Shs 15 trillion and they need between Shs 800bn to 1 trillion to handle mid-term access at a go.

“We agreed to schedule it. We don’t pay all at a go but about 20% of members in a certain period and have also have a criteria like age and amount saved,” she said.