A way from last week where we remained concerned about scandals in Pension Sector in Uganda, in Part II we look at the viability of liberalisation strategy towards cleaning up the Pensions Sector . During the 9 th Parliament, the Retirement Benefits Sector Liberalisation Bill , 2011 was tabled to push the diversification agenda of having many key players provide social security services to all Ugandan Citizens. With the coming into force of the 10 th parliament, this Bill is bound to bounce back on the floor with proposed reforms that will significantly alter the way retirement income is secured for retired workers in Uganda. Specific objectives of the Bill are; to allow private pension schemes to receive mandatory retirement contributions; provide for competition among licensed retirement benefits schemes for mandatory contributions; allow an employee to choose a Retirement Benefits Scheme of his or her choice; provide for annuity as an alternative to lump sum payment of retirement benefits; to provide for early or mid-term access of up to 30 percent of an employee’s retirement benefits; provide for transfer of retirement savings from one scheme to another in Uganda and EAC; repeal the Pensions Act, Cap 286 and convert the public service pension scheme into a contributory scheme and repeal the National Social Security Fund Act, Cap. 222. Uganda Debt Network, alongside other CSOs like Uganda National NGO Forum, WEEKLY UPDATE VOLUME 1. ISSUE 50 29th February—4th March, 2016 EDITORIAL Proponents of Liberalisaon of the Pensions Sector argue that this strategy will be more inclusive with more workers saving for rerement. With NSSF securing less than half a million workers savings, this argument is valid. However this should not be looked at in isolaon of other factors that make liberalisaon quesonable like risk of workers’ savings. It is also argued that diversificaon of the Pension Sector will open window for developmental pension reforms. Liberalisaon opens the operang space to all commercial players for purposes of profit maximisaon and this will involve risky investments that could affect the workers’ savings in the long run. We keep asking rhetorically; Is liberalisaon of the Pension Sector viable in ensuring proper accountability in the Pension Sector in Uganda? EDITORIAL TEAM Julius Kapwepwe—Director of Programmes Gilbert Musinguzi—Quality Assurance Manager Adellah Agaba—Communications Officer Umwiza Elizabeth—Intern we remain convinced that good policy reforms in retirement benefits sector should aim at improving coverage, reducing costs of administration, improving benefits and enhancing efficiency for the entire population and advance equitable and gender responsive economic growth and development. We continue to ask ourselves as to whether the proposed reforms under the Retirement Benefits Sector Liberalization Bill, 2011 will expand coverage; improve the amount or adequacy of benefits; reduce management and administration costs and above all reduce risk and improve efficiency in social security management. Private pension schemes risky: The decisions and actions of private pension firms and fund managers are motivated by the goal of profit maximization and not securing the retirement income of workers. It will therefore be socially and economically dangerous to put the mandatory contribution of workers in the hands of firms that will place them in investments that might be legally permissible but practically very risky. Individual choice of an appropriate retirement plan: The Bill provides that every employee in the formal sector shall register with a licensed retirement benefits scheme of his or her choice and shall make regular contributions to the retirement benefits scheme. Although, the right to contribute to scheme of one’s choice will give workers control over where their money is saved, it will also leave them with a duty to take decisions with potentially high risk outcomes. How many Ugandans understand the concept of Liberalisation? So, which way for Uganda? Next week we will explore more in Part III of the series. Improving accountability in Pension sector in Uganda: Liberalisaon strategy? (PART II) UDN appreciates support by: DGF, DCA, USAID-RTI/GAPP,USAID-PATH/ABH, SAVE THE CHILDREN, IG AND TROCAIRE