Uganda Withdraw Controversial Retirement Benefits Bill

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The Ugandan government has resolved to withdraw the contentious 2011 Retirement Benefits Sector Liberalisation Bill, to pave way for more consultations with workers who have for long voiced opposition to the piece of legislation.

State minister for Finance, David Bahati, moved a motion in Parliament yesterday, requesting that the Bill be withdrawn to give government time to carry out more consultations with workers before a definitive legislation is presented.

“This Bill touches on the sector that touches on the contribution of workers. We, therefore, think that it is important that we consult the workers so that we come back to the House when we have properly harmonised with the workers,” Mr Bahati said.

The Bill, first tabled in the 8th Parliament, has been problematic for the government because of the radical changes it proposes to create in the social security sector.

The Bill principally seeks to fix the pension sector by breaking the monopoly of the National Social Security Fund (NSSF) and free up the sector to open competition.

NSSF has opposed the Bill, warning MPs on the Finance Committee that opening up the pensions sector to different players is risky because some of them may collapse with workers’ savings.

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Another contentious proposal of the Bill is a clause that allows workers to choose the pension scheme where their money can be saved.

The Bill also seeks to make it compulsory for every employee in the formal sector to register with a scheme of his or her choice as well as making regular contributions to that scheme while those in the informal sector can join voluntary contribution schemes.

The other proposal under dispute is clause 11 (1) which states that a member may transfer his or her accrued benefits from one retirement benefits scheme to any other licensed scheme in Uganda or the East African Community. Allafrica

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