NASSIT Engages Labour Ministry on Informal Sector Scheme Project
The National Social Security and Insurance Trust (NASSIT) on Tuesday 6th August, 2024 engaged and informed the Ministry of Employment, Labor and Social Security on the status of the informal sector scheme project.
Addressing guests at the Radisson Blu hotel in Freetown, the Director General of NASSIT Mohamed Fuad Daboh said, for over 20 years, NASSIT scheme has covered mainly the formal sector which consists a minute portion of active labor force in the country.
“I want to start by thanking the Honorable Minister, for giving us this platform to update him and the ministry on a strategic project we have embarked on which is geared towards improving the lives of our compatriot in the informal sector…. NASSIT is a statutory public Trust charged with the responsibility of administering Sierra Leone’s National Pension Scheme. It provides attractive retirement and other benefits to meet the contingency needs of workers and their dependents.
In carrying out our statutory mandate, we have the responsibility to register all employers and employees, collect Social Security contributions, manage members’ data, pay Social Security benefits when a contingency occurs in line with sound investment principles. The NASSIT Act No. 5 of 2001 makes it compulsory for all workers in the formal sector to join, as long as there is an employer-employee relationship. The Act also makes provision for voluntary membership for those that are in the informal sector and the self-employed,” he said.
Director Daboh said that the current Scheme has proven to be unattractive to the informal sector in the country and therefore, members are reluctant to participate, and the inability of the NASSIT Scheme to attract their membership has increased their vulnerability to so many social risks related to their various fields of operations.
This he said led Management, in 2015 to initiate preliminary studies and stakeholder consultations at the local level. From these consultations, it became clear that there is a need to establish a scheme that is attractive to the informal sector workers.
“A concept was developed and presented to the Board of Trustees who gave Management the permission to proceed with the project. Unfortunately, the process was stalled due to several factors including proper coordination. In 2020, Management decided to engage the International Labour Organisation (ILO) on the possibility of providing technical support to NASSIT for the expansion of coverage to the informal sector, which the ILO consented. Since then, we have benefited a lot from support,” he added.
Presenting the report, Cyril Jalloh a member of the NASSIT Working Committee said, the informal sector constitutes of 90.43% whiles the formal sector consists of only 9.57% of the Labor force in Sierra Leone.
According to him, as at 2023, 29.40% of workers in the public sector are insured, 68.01% of private sector workers are insured whiles only 2.53% people in the informal sector are insured.
He said the informal sector has suffered a lot from the eleven years civil war, Ebola, national disasters and the COVID-19 pandemic which show the need for people in the sector to be included in the NASSIT scheme.
“Since 2009, NASSIT has been finding it difficult to conceptualize an appropriate social insurance scheme that meets the basic needs of workers in the informal sector. Through ILO, NASSIT was able to do a study of the situation of workers and economic units in the informal sector. NASSSIT will through our supervisory ministry launch the enrollment of workers in the informal economy. We will set up offices across the country to ensure we capture everyone in the informal sector.”
He concluded that this scheme will increase productivity in the informal sector, increase coverage and reduce exclusion rate, enhance national resilience towards poverty and shocks and finally increase national savings and growth in the economy.
The Minister of Employment, Labor and Social Security Mohamed Rahman Swarray said he was happy to be part of the engagement and with this call-to-action. He commended the NASSIT Management and the coverage of the NASSIT Scheme was very close to President Bio’s heart. He said his ministry will do all that is required to ensure this project becomes a success.