Push for informal sector to buy pension premiums

 

Participants during the Regional Social Security executives meeting at Serena Hotel. The New Times / T. Kisambira.

 
Regional Social Security executives need to develop pension schemes that will help include a large population in the informal sector to save for their retirement.

The call was made in a meeting that opened in Kigali yesterday that brought together heads of social security institutions in six regional countries.

In most participating countries, it was established, pension bodies cover between 8-10 percent of the working population, mainly in the formal sector, are covered, excluding 40-60 percent in informal sector.

The meeting was held under the framework of the East and Central Africa Social Security Association (ECASSA), which convened to discuss ways to expand pensions to the most rural community, to reduce the imbalance in social protection.

“I challenge policymakers and all social security funds to develop and nurture pro-poor policies that will see universal pension in our respective countries,” said Anastase Murekezi the Minister of Labour and Public Service.

Murekezi said the workshop should be a great opportunity for the gathering to share experiences on how different national approaches could be replicated in other countries to achieve universal pension.

It was highlighted that for years, developing countries, especially in Africa, have been living with the myth that they cannot afford inclusive social protection schemes.

However, countries like Rwanda, Namibia, Cape Verde, South Africa, Brazil, Mexico and Nepal are demonstrating to the World that basic social protection systems can reach out to the poor and that countries can afford to do so.

“I feel so humbled and proud that Rwanda is recognized for its efforts to enrol 90 percent in the community health insurance scheme,” Murekezi said.

“The biggest challenge is lack of a saving culture and mind set but also how to develop products and meet their unique circumstances,” said Rose Musonye Kwena from Kenya Retirement Benefits Authority.

Once pension coverage is expanded to a larger community in the informal sector, it is expected to contribute towards attaining the Millennium Development Goals.

However, participants noted a key challenge was how to create the political processes that will make the fiscal space for social protection available.