THE PUBLIC SERVICE SOCIAL SECURITY ACT, 2018
In April 2018, Tanzania’s President, John Magufuli, signed into law the Public Service Social Security Act, 2018 which joins all pension funds into two major entities.
The entire labour force in both the public and private sectors will be served by the Public Service Social Security Fund (PSSSF) and the National Social Security Fund (NSSF).
Currently there are five social security funds in the country. They are the National Social Security Fund (NSSF), PPF Pension Fund, Public Service Pension Fund (PSPF), Local Authorities Pension Fund (LAPF) and Government Employees Provident Fund (GEPF). Because of the new PSSS Act, the Public Service Retirement Benefit Act Cap 371, the LAPF Pensions Fund Act Cap 407, the GEPF Retirement Benefits Fund Act Cap 51 and the PPF Pensions Fund Act Cap 372 will be repealed.
Upon the publishing of the regulations for the implementation of the new law, the monies of the former Funds shall, with effect from the date of commencement of the Act, be transferred to the newly established PSSSF.
A member who changes employment from the public sector to employment in the private sector’s membership will be transferred to the National Social Security Fund, and all employees in the public sector who are members of the National Social Security Fund will be transferred to the PSSS Fund.
The contribution rate is as follows:
- Employee contribution: 5% of the employee’s monthly salary
- Employer contribution: 15% of the employee’s monthly salary.
The new Act has also introduced two new benefits which were not granted earlier by the Pension Funds. These are Survivor Benefits and Unemployment benefits. Survivors benefits would be paid to the Dependents of the deceased (widow, children or parents of the deceased).
The Act also specified retirement age as 60 years for compulsory retirement and 55 years for voluntary retirement.
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