International solidarity behind trade union victory over improved social security in Uganda

After year-long efforts, DTDA and NOTU can, at last, celebrate the approval of a bill with amendments to the country’s national social security fund. This new legislation will contribute to improving the lives of all workers, including those active in the informal economy.

Fewer might fall through Uganda’s social security net thanks to a new bill with amendments to the Act on the national social security fund (NSSF) that President Yoweri Museveni signed on 4 January. With this approval, Uganda’s National Organisation of Trade Unions (NOTU) witness the realisation of a long-lasting objective that comes after many years of hard work supported by the Danish Trade Union Development Agency (DTDA).

The new bill brings important changes in the functioning of social protection in Uganda. Among other novelties, the bill tears down previous restrictions to workers’ access to pension schemes. In Uganda, workers contribute savings for their old age pensions, with additional contributions from their employers. However, only workers with formal contracts and employed by businesses with more than five workers were eligible to access the pension schemes, effectively leaving out of the system the vast number of workers who were working in the informal economy (i.e. nine out of ten).

“The new bill has many great advantages. Now, it opens many possibilities for all workers, but especially the workers in the informal economy,” said NOTU Chairman-General Usher Wilson Owere in reference to the change brought about by the bill, which now allows individual contributions to NSSF, including those of workers in the informal economy.

Covid-19 disclosed great needs

For many years, NOTU has advocated that the members of NSSF should be entitled to have mid-life access to parts of their savings. This is particularly relevant in Uganda, as the citizens have a low life expectancy (63 years) and simply die before they can claim their savings. The Covid-19 pandemic proved blatantly this reality and brought back the issue of mid-life payments in the political agenda as the economic pressure and the loss of many jobs have been increasing workers’ need for cashing in some of their savings.

The new bill will make it possible to take out 20 per cent of the NSSF savings for members aged 45 and above who have saved for at least a decade. People with disabilities will also gain easier access to mid-life payments.

A victory for the trade union movement

Before the passing of the bill, it was only mandatory for businesses with at least five employees to make employer payments to the NSSF (10-20 per cent of the wage depending on the scheme). Now, all employers will have to contribute.

The bill is a victory for the trade unions, who since 2014 have continued to work hard to have it passed. Although the bill has been rejected by parliament several times, NOTU has maintained close contact with President Museveni, who has been directly involved in adjusting the bill for the final adoption by parliament.

”We’ve had meetings with the president to cast a light on the critical areas and finally, there were no more conflicts,” said Usher Wilson Owere who called the bill the gift of New Year 2022 and twitted when the news of the president’s signature broke, presenting it as a “gift of the new year 2022”.

…and a victory for trade unions’ international solidarity

This victory is also the fruit of long-standing cooperation between the Danish Trade Union Development Agency – DTDA and NOTU, which has contributed training in capacity building on research, negotiations skills, and consensus-seeking social dialogue, among others. Furthermore, DTDA has for almost 15 years supported NOTU in making the workers in the informal economy visible both within the trade union movement and on the political agenda.

This work has strengthened NOTU’s capacity and skills to petition the parliament on issues such as the liberalisation of the pension sector for which NOTU has fought for years. One of the main objectives of NOTU has been to ensure that the informal economy workers are covered under NSSF Scheme, which has become reality with the new act.

Furthermore, because of the growing influence and visibility in the labour market of Uganda, NOTU has been increasingly vocal on demands following the outbreak of the Covid pandemic.