Uganda: Government Withdraws New Pensions Bill

Kampala, Uganda — Government has withdrawn a new pension Bill that was recently tabled in Parliament.

The Public Service Pensions Fund Bill,2023 introduced on 14 March 2023 aimed at implementing a mandatory contribution system for public servants' pensions.

However, the bill underwent significant changes during the committee review, prompting the decision to withdraw it.

Under the proposed legislation, every public servant would be required to contribute five per cent of their gross salary to the pension fund each month, while the government's contribution would be reduced to 10 per cent of the employee's gross salary.

This would mark a departure from the current system in which the government contributes 100 per cent to the pension fund.

The Deputy Speaker, Thomas Tayebwa while presiding over plenary on Tuesday, 23 May 2023 said that over 60 per cent of the bill had been modified by the Committee on Public Service and Local Government.

"I have noted that the proposed amendments are numerous and substantially change the content and subject matter of the bill thereby changing the bill that was published and introduced by the government for first reading," Tayebwa said.

Attorney General Kiryowa Kiwanuka, upon request, officially withdrew the bill, expressing no objections.

He acknowledged the financial implications of the amendments and commended the committee's work.

He said the executive will scrutinize the bill thoroughly and promised its reintroduction at an appropriate time.

Tayebwa emphasized the importance of the bill and urged the Executive to expedite its review.

The committee's report had outlined several key recommendations, including the prohibition of borrowing by the pension fund's board to avoid high interest rates and borrowing risks.

The committee had also proposed changing the date for monthly contributions to the 15th of the following month to prevent delays in salary disbursement.

The proposed Public Service Pension Fund would operate similarly to the private sector's National Social Security Fund (NSSF).

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