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Social security is a precondition for ensuring well-functioning labour markets, new report argues

The recently released World Social Protection Report 2020 says, “social security is not only compatible with labour market flexibility; it is indeed a precondition for ensuring well-functioning labour markets that generate productive and decent employment without unduly shifting financial risks on to individual workers and employers.” 

The report says just about 3.2% of the labour force in Uganda is covered by a pension scheme (active contributors) and indeed a paltry 2.8% of the population is covered by at least one social protection benefit. This has left the majority of the population vulnerable to shocks and poverty.

Social security refers to protective and preventive interventions to mitigate factors that lead to income shocks and affect consumption such as retirement, ill-health, unemployment, old age, disability, death of breadwinner or disasters. Social security as expressed in the National Social Protection Policy (2015) enables people to continue living lives of dignity after retirement or when a calamity that could adversely affect their income befalls them.

Uganda’s labour force is largely concentrated in the informal sector characterised by jobs not subject to social protection; no provision for pension or contribution to the National Social Security Fund (NSSF) and no entitlement to paid annual or paid sick leave. In it’s current form, the NSSF target formal sector workers hence limited in coverage of the labour force.

According to the report, in order to support labour market mobility, the development of specific branches of social protection (among them unemployment protection), broad risk-sharing, and the portability and transferability of rights and entitlements are essential.

The coronavirus pandemic according to Uganda Parliamentary Forum for Social Protection (UPFSP)’s  Flavia Kabahenda Rwabuhoro, has brought to the fore the urgent need for a strong social protection system and it is important to broaden the discussion beyond the existing interventions that have proved ineffective.

Kabahenda, who is also the current chairperson of the Committee of Gender, Labour and Social Development argues that it is time to ensure that social protection is streamlined in every sector and embedded in the respective programming.

In what has been termed by ILO as ‘taking the high road’ requires building permanent universal social protection systems that provide adequate and comprehensive coverage to all, guided by effective tripartite social dialogue.

These systems according to the report are essential for preventing poverty and inequality, and for addressing today’s and tomorrow’s challenges, in particular by promoting decent work, supporting women and men in better navigating their life and work transitions, facilitating the transition of workers and enterprises from the informal to the formal economy, bolstering the structural transformation of economies, and supporting the transition to more environmentally sustainable economies and societies.

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