Francis Atwoli, the Secretary General of the Central Organization of Trade Unions (COTU), has addressed concerns surrounding the government’s decision to double National Social Security Fund (NSSF) deductions, reassuring Kenyan workers that these changes will ultimately benefit them in the long run.
In a statement issued on Tuesday, February 4, Atwoli dismissed the political backlash against the increased NSSF contributions.
He accused political leaders of spreading misinformation and misleading the public on the matter. He emphasized that the NSSF Act of 2013, which is being implemented in phases, is crucial for ensuring that workers have a secure financial future upon retirement.
Atwoli clarified that NSSF is not a tax, but rather a compulsory savings program designed to help workers save for retirement with dignity.
He pointed out that some of the politicians opposing the new rates are people who already have secure income streams or generous pensions from their businesses, and therefore, don’t understand the struggles faced by ordinary workers.
The new NSSF rates, which will see employed Kenyans contribute Ksh4320 each month (up from the previous Ksh2160), will begin in February 2025.
This increase in contributions is part of the phased implementation of the NSSF Act of 2013. Under the revised plan, employees will contribute 6% of their salaries, and employers will match these deductions.
The income threshold for pension contributions has also been raised, with the minimum pensionable salary now set at Ksh9,000 (up from Ksh7,000), and the upper earnings limit raised to Ksh29,000, meaning those in higher income brackets will contribute more.
Although the NSSF Act was passed in 2013, its implementation was delayed for years due to legal challenges. However, in 2022, the Court of Appeal gave the green light for its implementation.
Atwoli highlighted the importance of social security as a fundamental human right, citing global standards set by the International Labour Organisation’s Convention No. 102 (1952) and Kenya’s Constitution, which guarantees citizens the right to pension and social security under Article 43.
He strongly urged support for the NSSF’s mission, noting that a well-structured pension system not only ensures a lump sum payout but also provides a monthly pension, enabling retirees to maintain a decent standard of living.
Atwoli also compared Kenya’s social security contributions with other East African countries, pointing out that Kenya’s rate of 12% (6% from both the employer and employee) is lower than Uganda’s 15% (10% employer, 5% employee) and Tanzania’s 20% (10% employer, 10% employee).
The COTU boss called on Kenyan workers to reject any negative narratives surrounding the NSSF and to stand firm in support of its full implementation.
This increase in contributions comes at a time when the government is also introducing new tax measures, which are expected to further impact the take-home pay of Kenyans.
The National Treasury’s introduction of the Tax Procedures (Amendment) Bill, Tax Laws (Amendment) Bill, and Business Laws (Amendment) Bill is part of an effort to address the country’s budget deficit, following the withdrawal of the controversial Finance Bill 2024.
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