Kasaija pledged to support the NSSF amendment Bill before Parliament, however, warned on the issue of midterm access to NSSF savings saying it should be examined.
The Finance Minister, Matia Kasaija on Monday while presiding over the 8th NSSF Annual Members meeting raised worries concerning the issue of midterm access to NSSF savings saying that it should be critically examined so that the purpose of saving is not undermined.
In a function held at the Kampala Serena Hotel, Minister Matia Kasaija basing on section 35 (2) of the NSSF Act declared NSSF interest rate of 10.75% for FY 2019/2020 which translates into UGX 1.14 trillion to be paid in interest to members.
Kasaija also pledged to support the NSSF amendment Bill before Parliament, however, warned on the issue of midterm access to NSSF savings saying it should be critically examined so that the purpose of saving is not undermined.
The bill makes it mandatory for all employers including those employing less than 5 people to remit social security contributions for their workers.
The Minister also said issues of managing finances is a responsibility of the Ministry of Finance and not any other sector. He called upon Ugandans to improve on their saving culture and avoid wastage of funds on merrymaking.
“Teach your children saving culture when they are still young,” part of Kasaija’s statement read.
This comes at a time when several Ugandans have in recent weeks raised proposals to government to issue people at least a certain percentage of their NSSF savings to cushion them more so those feeling the pinch posed by the coronavirus pandemic.
Since the outbreak of the Covid-19 in the country, many businesses around the country have been tremendously hit with some even still under lockdown while others are trying to rebuild following months of lockdown.
This has since culminated into locals especially the private workers to demand the government to consider issuing them part of their savings at least 20% to help them adjust to the dangers posed by the virus.
Earlier, the NSSF management issued a warning that the decision will tremendously affect the country’s already hit economy. The management raised threats of inflation that might arise in case they decided to give back all people a certain portion of their money.
Based on the statistics of June 2019, NSSF has about 1.5 million members who contribute to the fund every month and if they decided to return every single person’s money, then this would increase money circulation in the country.
And since these are bad times when almost every single individual is focused on stocking food items in their homes, many Ugandans would flock the shopping centres for panic buying and this will lead to a hike in the price of goods since demand will have surpassed the supply.
The management also said that this will in return result into the locals’ loss of confidence in the shilling in favour of for foreign currencies like the dollar thereby growing the value of the dollar with the shilling continuing to fall even further.