NSSF - National Social Security Fund (NSSF) - Tanzania

The National Social Security Fund (NSSF) was established by the Act of Parliament No. 28 of 1997 to replace the defunct National Provident Fund (NPF). NSSF is a compulsory scheme providing a wider range of benefits which are based on internationally accepted standards.

 

NSSF covers the following categories of employers and employees:-

A.  Private Sector which includes:-

• Companies
• Non-governmental organizations
• Embassies employing Tanzanians
• International organizations
• Organized groups in the informal sector

B.  Government ministries and departments employing non-pensionable employees.

C.  Parastatal organizations

D.  Self-employed or any other employed person not covered by any other scheme

E.  Any other category as declared by the Minister of Labour

Scheme’s Financing

The scheme is financed through contributions at the rate of 20% of employees’salary. The employer is required to deduct from employee’s gross salary the amount of contribution not exceeding 10% of the employee’s salary. The employer adds the remaining balance to make the required contribution rate of 20%.

Scheme Investment

NSSF is a fully funded scheme running under defined benefit principles. All funds collected are wholly invested for the purpose of financing benefit payments.

Scheme’s Benefits

The scheme provides seven benefits which are categorized as long term benefits and short term benefits as follows;

Long Term Benefits/Pensions

• Retirement Pension
• Invalidity Pension
• Survivor’s Pension

Short Term Benefits/Pensions

•  Funeral Grant
• Maternity Benefit
• Employment Injury Benefit
• Health Insurance Benefit

Pension is a term which expresses all long-term benefits offered by the scheme. It defines periodical payments given to a retired member, invalid persons and survivors of the deceased member to replace the loss of income resulting from old age, disability or death.Important issues under NSSF Benefits

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NSSF pension benefits are members’ right

• The benefits are paid directly to the beneficiaries without going through the employer.
• The Initial Lump Sum payment to pensioners does not form part of normal periodic pensions.
• In some schemes this amount is normally deducted from the regular pension.
• The benefits are offered to both indigenous and non-indigenous members.
• The pension will not be affected as a result of changing occupation.
• Short-term benefits payable to members during their working period such as maternity, employment injury, and health insurance will not affect retirement benefits.