KRA to collect NSSF contributions
05 July 2013, 14:42
Nairobi - The Labour Cabinet Secretary, Kambi Kazungu reiterated his department's committment to crack whip on NSSF Reforms.
The Labour Secretary announced that the ongoing reforms will guarantee the funds capacity to deliver on its social security promise.
Hitting the ground running, Kazungu has already endorsed plans to outsource the collection of NSSF contributions to the Kenya Revenue Authority (KRA) in coming weeks under a mutually agreed service level agreement.
Speaking in Mombasa during the opening session of a two-day Labour and Social Welfare Parliamentary Committee retreat to fine-tune the draft NSSF Bill 2012, Kazungu stressed that the outsourcing of NSSF contribution collection to KRA will help plug unnecessary revenue leakages.
Already, Kazungu explained satisfaction that NSSF has successfully managed to outsource its Investment funds management and custodial services to reputable local financial management solutions providers as part of its corporate governance reforms agenda.
The Cabinet Secretary also singled out the competitive selection and appointment of current Managing Trustee Tom Odongo, as one of the recent indicators of corporate governance reforms at NSSF.
At the same time, Kazungu also promised to urgently address the NSSF Board of Trustees gender imbalance by appointing eminent ladies to sit on the board.
“My Ministry supports the NSSF in its reform agenda particularly as its sets out to change the nature of the scheme, governance, contribution and replacement rates in line with our constitution,” Kazungu explained.
Kazungu went on to add that “The NSSF Bill 2012 which anchors reforms and transformation at NSSF is particularly crucial as it focuses on extending coverage and enhancing benefits for the advantage of the fund members upon retirement.”
The two day retreat hosted by NSSF for the Parliamentary Departmental Committee members among other legislators is one of the last mile engagement forums geared at fine-tuning the draft NSSF Bill 2012 set to be, tabled in parliament in coming weeks.
Alongside the Parliamentary Committee members, other delegates’ attending the retreat include: Labour Principal Secretary Ali Noor, Parliamentary Majority Leader Adan Duale, Law Scholar Arthur Eshiwani and Actuarial Expert Sundeep Raichura among others.
Speaking during the opening session, NSSF Managing Trustee Tom Odongo acknowledged that the draft NSSF Bill 2012 which received the Cabinet’s backing late last year, is set to will provide the necessary legislative foundation to facilitate efforts geared at converting NSSF from a provident fund into a public mandatory pension security scheme.
Featuring a range of enhanced corporate governance structures, the proposed NSSF Bill, Odongo said will provide enhanced social security products to existing members while increasing social security coverage through comprehensive benefits to all workers in line with the new Constitution and Vision 2030 ideals.
Pension benefits outlined in the bill include: Retirement pension, Invalidity pension, funeral grant Survivors’ and emigration benefits. Under its provident fund, members’ will enjoy tax-exempt: invalidity, withdrawal, emigration, age, and survivors’ benefits.
The proposed NSSF Bill 2012 seeks to position the fund as a public mandatory pension security scheme covering all employees in the formal sector and a voluntary scheme for the self-employed and workers in the informal sector who wish to make voluntary contributions to the Fund.
The NSSF transformation bill, Odongo further assured, remains consistent with Government policy and the tenets of the new Constitution of Kenya (Section 43), which gives all Kenyans a right to social security.
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