If we are to think objectively and coherently as a country, the NSSF should be abolished or privatised. The NSSF Act is unconstitutional whichever way you look at it. The term social security is used to refer to grants by the government to the most vulnerable of the citizens. NSSF is not social security because it is not funded by the government. Inua Jamii is social security.
What we should have is a National Social Security Act to regulate government-funded social security initiatives such as Inua Jamii. Any scheme where private citizens and employers contribute is a purely private sector affair.
NSSF is a retirement benefit scheme regulated by the Retirement Benefits Authority and is entirely privately funded. The RBA Act should suffice for NSSF and the NSSF Act should be repealed.
The government only contributes to the NSSF as an employer. Why in whatever name is the government involved in NSSF’s affairs? Why is the chairperson of NSSF appointed by the cabinet secretary? Why are the PSs Treasury and Labour part of NSSF?
The only answer to why the government is involved in NSSF which is a purely private affair is to facilitate the theft of the funds. Under normal circumstances, NSSF should be run as any other retirement benefits scheme with zero government involvement.
The involvement of the government in NSSF has resulted in an opaque, inefficient and poorly government entity that resembles a criminal enterprise. Over the years, it has earned a reputation as an epicentre of corruption and plunder. You just need to google “NSSF Kenya scandals” to see how apt this description is.
The idea of mandatory NSSF contribution is extremely intrusive, excessive, oppressive and extractive. It amounts to treating Kenya like a nanny state where the government is involved in the most mundane of citizen’s affairs.
Kenyans have so many ways in which they save for retirement including retirement benefits schemes, real estate, stock market, collective investment schemes, bank deposits, government securities, SACCOs, mobile money, mattress banking etc.
All these are voluntary. What is the point of this mandatory scheme especially considering that only 3 million Kenyans are formally employed out of a workforce of over 20 million people?
Most private sector employers operate retirement benefits schemes. The government recently implemented the Civil Servants Superannuation Scheme which is an RBS for civil servants. If the purpose of NSSF is to make Kenyans save for retirement, why force someone who is already saving for retirement to pay NSSF? Isn’t this duplication?
Even if there was a point in forcing people to save for retirement, why force them to save through a specific entity? What is special about this entity? To make matters worse, this entity is opaque and consistently delivers below-market returns.
The last financial statements on NSSF’s website are for the 2021-22 financial year. We are in 2025! What is this opaqueness about if not to hide inefficiency and poor returns?