NSSF Calls On Employers To Embrace Full Implementation Of New Rates

The National Social Security Fund  (NSSF) has called on all employers to embrace the full implementation of the NSSF Act No 45 of 2013.

Under the Act, NSSF seeks to build a bigger retirement package for workers. As such, the pension scheme increased total contributions for both employees and employers to 2,160 shillings monthly from 200 shillings.

The latest decision by the Fund followed a court of appeal ruling that termed the NSSF Act of 2013 legal. This was after months of clashes that delayed the implementation of the Act.

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The High Court of Kenya had quashed the law and declared the bid unconstitutional, null, and void, saying the NSSF Act, 2013, was in breach of the Constitution and further citing a lack of public participation ahead of its enactment.

The latest ruling came just a few months after president William Ruto publicly said that the members’ contribution should be increased to ensure Kenyans have reasonable savings. Ruto said he has agreed with the NSSF management and board to go back to the courts and push for increased compulsory monthly contributions towards retirement.

Speaking during the opening of the NSSF Corporate Strategic Plan Board retreat at a Mombasa Hotel, Labour and Social Protection Cabinet Secretary Florence Bore stressed the need to re-engineer the NSSF processes to enhance member benefits payments.

CS Bore assured Kenyans that her Ministry will work closely with all stakeholders to ensure that section 43 (e) of the Kenyan Constitution that every Kenya has the right to social security is a reality. She assured the NSSF team that her ministry will support the Fund in its planned public sensitization and member education campaigns to enhance the culture of savings which has been unimpressive for years.

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Various studies have established that Kenya’s savings rate is way below Africa’s average of 17 percent. In contrast,  east African Uganda and Tanzania have already crossed the 20 percent mark, signifying more advanced savings.

Various factors have been blamed for Kenya’s poor saving culture among them a high spending power. Others include poverty, inadequate financial education, and a limited range of available financial incentives. The NSSF Board of Trustees has expressed confidence that the current development on savings is a significant milestone and a big win for Kenyan workers.