Wider social security coverage underway

By Felix Andrew
23rd June 2011

Authority aims at 5 per cent membership by 2014
Social Security Regulatory Authority Director General Irene Isaka briefs journalists in Dar es Salaam yesterday on her agency`s role. This was at the Public Service Week exhibitions going on at Mnazi Mmoja grounds.

The number of Tanzanians enjoying social security is expected to increase to 5 per cent by 2014 from the present 3.5, thanks to new strategies laid down by the Social Security Regulatory Authority.

Already the authority has started addressing six challenges which hinders smooth functioning of the social security funds countrywide.

Speaking to journalists in Dar es Salaam yesterday, the SSRA Director General Irene Isaka said currently only 3.5 per cent of Tanzanians are registered with social security funds.

The percentage was not healthy for the future of many Tanzanians, because when they get older they would not be able to receive any social protection, she said.

“We want to increase the percentage to at least 5 per cent in the coming three years if all things go well,” she said.

Isaka said they plan to increase coverage to farmers, pastoralists and other rural-based populations so far neglected by the funds.

She said an increase will necessitate changes to the laws which established the various social security funds.

“Currently the law does not recognise our authority. Once the Parliament has endorsed the changes we shall be able to implement our strategies,” she added.

Isaka said the authority has formed a research department which would study ways to increase the number of Tanzanians in the social security funds.

She said they had improved the communication department which would help sensitise Tanzanians on the role of social security funds. The SSRA also plans to establish social security week aimed at educating Tanzanians on its activities.

The DG named other challenges as transferability of members from one fund to another, depreciation of the value of shilling, lack of data and delayed member’s payments.

According to the DG, the authority that was formed early this year would ensure schemes remain secure and sustainable, members’ interests are protected and coverage is increased.

She also noted the task force which was established to address key challenges was about to complete its task

The taskforce drew its members from the Attorney General’s chamber, the ministry of Finance, the Bank of Tanzania, experts on Social Security from the International Labour Organization (ILO) and the ministry of Labour, Employment and Youth Development.

Experts say Tanzania has potential opportunities that remain uncovered by the social security schemes and which call for the government’s intervention to increase coverage.

A well-designed social security scheme should be broad-based with adequate coverage and be sustainable.

They say the authority should ensure that funds are invested according to rules or investment guidelines as the government looks at the possibility of widening coverage of social security services in the country, to include people who are self-employed in the informal sector.

Speaking to this paper in an interview, Dr Kingu Said Mtemi said some pension funds were not performing well, adding that there is a need for a review of the prevailing legislation to allow members to cross to funds that are more efficient.

He said time has come for the law to allow transferability of members from one fund to another to enable members pick those which can benefit them most.

Mtemi also urged the government to make sure that pension funds remain secure and sustainable.

“Those who have been tasked to secure members’ interests should make sure that they are protected and coverage is increased and the funds are invested according to the prevailing rules or investment guidelines,” he said.

He told the pension funds to review the members’ payment system saying most of them have become outdated.

“The shilling is ever depreciating, inflation is skyrocketing and even the taxes have gone up, these funds should now start paying members according to the value of the shilling,” he stated.

At the moment, only 3.5 per cent of Tanzanians are covered by the funds, while in Kenya coverage is 8 per cent and Uganda is 11 percent.
SOURCE: THE GUARDIAN