Atwoli welcomes increase in NSSF deductions, cites benefits to employees
The Central Organization of Trade Unions (COTU) has welcomed the National Social Security Fund (NSSF) Board of Trustees’ recent decision to implement the NSSF Act of 2013.
COTU Secretary General Francis Atwoli indicated in a statement that social security is a basic human right that addresses the need for protection against various life risks and social needs.
He also stated that Article 43 of the Kenyan Constitution of 2010 provides for every Kenyan citizen’s entitlement to a pension and social security.
The implementation of the NSSF Act of 2013, according to Atwoli, will make it mandatory for employers to provide a provident fund and a pension scheme for their workers.
“Many workers have only been contributing to and receiving funds from the provident fund, which is a lump sum payment that workers have been receiving at a go, (Tier I). After receiving the lump sum from the provident fund, Kenyan workers have been left exposed to old age poverty with no social security covering them,” Atwoli said.
The move followed the Court of Appeal’s decision to stay the entire judgment of the Employment and Labour Relations Court on the act.
With the passage of the NSSF Act, employees will be able to contribute to and receive funds from both the provident fund (Tier I) and the pension fund (Tier II). Atwoli also stated that employers may opt out of Tier II in exchange for a better scheme, but employees will still be entitled to monthly benefits upon retirement.
Atwoli also reminded employees that NSSF deductions are not tax deductible and that they will have access to the funds when they retire.
He also stated that COTU is prepared to hold a high-level tripartite consultation to address any issues that may arise during the implementation of the NSSF Act of 2013.
Furthermore, Atwoli urged the NSSF Board of Trustees to appoint a capable Managing Trustee/CEO who will lead with integrity and resist corrupt practices.
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