Social security schemes need to rise to occasion

By Editor
7th April 2011

Delegates to a recent meeting of the Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA) were unanimous that the law ought to provide for the possibility of people seeking membership in pension funds of their choice.

They also appealed to the government to ensure that all such schemes place a premium on efficiency and not failing security and sustainability tests.

That voices were being raised over the importance of streamlining or rationalising the duties and responsibilities of pension funds in the country at a time when concrete measures have already been taken to that effect is, at best, surprising.

Could it really be true that the Social Security Regulatory Authority, which was created by law in 2008 and which President Jakaya Kikwete launched in the third week of last month, was established unbeknownst to agencies such as TCCIA?

Yes, not even a month has passed since SSRA officially took up the task it was set up to undertake – that of regulating the operations of social security and pension funds in the country. However, the period between the enactment of the law under which the agency was established and its official launch on March 23 is long enough for all interested parties to have a rough idea about what the whole thing entails.

Anyway, SSRA is now in business. The much we know is that it is still busy trying to sell itself alongside identifying problems or challenges in its area of operation and generally proving its worth before a public eagerly waiting to see the difference it will make in the state of pension funds and the lives of pension fund members.

Indications are that all six pension or social security funds in the country – National Social Security Fund, Parastatal Pensions Fund, National Health Insurance Fund, Local Authorities Pension Fund, Public Service Pension Fund and Government Employees Pension Fund – are fully briefed on the bearing the advent of SSRA will likely have on their future operations.

Fortunately, most say they hope to have lined themselves up appropriately enough to face the future with enhanced hope by the time the regulatory authority digs in.

In a recent comment, we argued that the easiest way for social security schemes to expand their membership bases is to come up with impeccable evidence that they are institutions of unquestionable integrity whose members are sure to find value comfort and relief in retirement.

We also noted that the schemes’ infrastructural and other investments are implemented largely thanks to members’ contributions and should not be made at the expense of the members.

SSRA will be credited with a job well done if, as it plays its regulatory role, it sweeps the social security sub-sector clean by ending unhealthy inter-scheme competition and creating conditions making it possible for more ordinary Tanzanians to join and benefit from the industry.

We say this because we understand that, so far, social security schemes serve no more than six per cent of Tanzania’s labour force and 3.5 per cent of the country’s population. This is by all accounts sad, and the schemes should feel duty-bound to save the day.
SOURCE: THE GUARDIAN