Young retirees’ insurance coming

DAILY NEWS Reporter in Moshi

PRESIDENT John Magufuli addresses the mamoth rally as part of the International Workers Day celebrations in Moshi, Kilimanjaro Region, yesterday. (Photo by State House).

PLANS are afoot to establish an insurance fund to cater for monthly stipends to employees losing jobs before the retirement age, President John Magufuli announced yesterday.

Dr Magufuli revealed further that the government envisages merging several social security schemes into two major entities to trim operational costs.

Addressing a mammoth crowd that turned up for the International Labour Day here, President Magufuli said the new insurance fund will replace the hitherto withdrawal benefits that pension funds pay.

“A Bill for the enactment of the fund will be tabled soon in the National Assembly and once passed, I will immediately assent it into legislation,” Dr Magufuli declared, hinting that the government was in the process to reduce the number of pension funds into two schemes. “A cabinet paper on the matter has been finalised and we are in good progress.

Through the merging, we expect to reduce the operational costs, which the funds incurred. Under the merger, we will also address the problem of discrepancies in the calculation of terminal benefits for pensioners by different schemes,” he explained.

Dr Magufuli assured workers countrywide that the government will continue improving their welfare and settling all outstanding arrears. “When I assumed power (in November 2015), the government owed social security funds a whopping 1.5tri/- in employees’ contributions but as of now, we have paid 1.23tri/-,” he stated, vowing to settle the remaining balance, soon.

The Head of State censured employers, including the government, whom he accused of delaying workers’ contributions to the pension funds, and ultimately, inconveniencing the payment of terminal benefits to the retirees.

Pledging improved welfare to workers, Dr Magufuli said the government had suspended new recruitments and promotions, pending the cleansing of the government payroll of phantom workers and forged certificate holders.

“Now that we have cleared ghost and unqualified employees, we can now effect annual salary increment and promotions,” he pledged. The purge on ghost jobs and fake certificates has netted 19,706 and 9,932 victims, respectively, who have been deleted from the payroll. The verification exercise on academic certificates covered some 435,000 workers countrywide.

“The government used to pay over 230bn/- each year to phantom workers in salaries, leave alone other allowances; the money could have been used to improve the wellbeing of genuine employees,” argued Dr Magufuli, declaring 52,000 new job vacancies in the public sector in the coming fiscal year.

On the other hand, President Magufuli praised the current leadership of the Tanzania Unions’ Congress of Tanzania (TUCTA) for truly working on the interests of employees, blaming some past leaders of the trade union for “working for personal interests.”