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The Status of Social Security Systems in Uganda: Challenges and Opportunities

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The Status of Social Security Systems in Uganda: Challenges and Opportunities THE STATUS OF SOCIAL SECURITY SYSTEMS IN UGANDA: CHALLENGES AND OPPORTUNITIES Paul Bukuluki John-Bosco Mubiru REALITY CHECK THE STATUS OF SOCIAL SECURITY SYSTEMS IN UGANDA: CHALLENGES AND OPPORTUNITIES Paul Bukuluki John-Bosco Mubiru Makerere University School of Social Sciences, College of Humanities and Social Sciences,Makerere University, Kampala, Uganda November 2014 The views expressed in this publication do not necessarily reflect the views of the Konrad-Adenauer-Stiftung but rather those of the author. CHALLENGES AND OPPORTUNITIES i REALITY CHECK THE STATUS OF SOCIAL SECURITY SYSTEMS IN UGANDA: CHALLENGES AND OPPORTUNITIES ISBN: 978 9970 477 03 6 Authors Paul Bukuluki John-Bosco Mubiru Konrad-Adenauer-Stiftung, Uganda Programme 51A, Prince Charles Drive, Kololo P.O. Box 647, Kampala Tel. +256 414 25 46 11 www.kas.de © Konrad-Adenauer-Stiftung e.V. 2014 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, without prior written permission on the Konrad-Adenauer- Stiftung. ii THE STATUS OF SOCIAL SECURITY SYSTEMS IN UGANDA CONTENTS Foreword ............................................................................ vi List of acronyms and abbreviations ................................... vii 1.0.Introduction ..................................................................1 1.1.Background about Uganda ................................................ 2 1.2.Poverty and Vulnerability Context in Uganda ........................ 4 1.2.1.Income inequality in Uganda ..................................... 6 1.2.2.Poverty incidence and education level in household ...... 7 1.3. Poverty among the Vulnerable Groups in Uganda ................. 8 1.3.1.Older persons ......................................................... 8 1.3.2.Persons with disability (PWDs) .................................. 9 1.4.Social Security and Social Protection ..................................10 1.5.Conceptual and Analytical Framework ................................12 1.5.1.Conceptual debates in social protection policy and programming ..........................................19 1.5.2.Transformative social protection framework and social protection in Uganda ................................24 2.0.Global perspective on social security systems .............26 2.1. Industrialised Countries ..................................................27 2.2. Communist Countries .....................................................29 2.3. Transitional Countries .....................................................30 2.4. Developing Countries ......................................................31 3.0.The evolution of social security Systems in Uganda .....................................................34 3.1.Pre-colonial Period ..........................................................34 3.2.Colonial Period (1894 - 1962) ...........................................36 CHALLENGES AND OPPORTUNITIES iii 3.3.Post-independence Period (1962 to-date) ...........................39 4.0.Institutional, legal and policy Framework of social security systems in Uganda ..............46 4.1.Institutional Framework ...................................................46 4.2.Legal and Policy Framework of Social Security Systems in Uganda (Acts, Policies, Strategies and Development Plans) ........................................................49 5.0.Drivers and opportunities for the Development of social security systems in Uganda ...........57 6.0.Analysis of key social security Schemes in Uganda ...........................................................61 6.1.Public Service Pension Scheme (PSPS) ...............................61 6.2.The Parliamentary Pension Scheme ...................................62 6.3.National Social Security Fund (NSSF) .................................64 6.4.Reforms in the Pension Sector of Uganda ...........................65 6.5.Workers’ Compensation ...................................................71 6.6.National Health Insurance ................................................72 6.7.Social Assistance Grants for Empowerment (SAGE) ..............75 6.8.Public Works Programmes ................................................76 6.9.Private Social Security Schemes ........................................78 6.9.1.Private health insurance schemes ...................................79 6.9.2.Community-Based Health Insurance Schemes ..................80 6.10.Informal Social Security Systems in Uganda......................83 7.0.Gender and social security in Uganda ..........................87 8.0.Financing social security in Uganda .............................90 8.1.Social security spending on the Public Service Pension Fund (PSPF) .............................................................91 8.2.National Social Security Fund (NSSF) .................................93 iv THE STATUS OF SOCIAL SECURITY SYSTEMS IN UGANDA 8.3.Direct income support .....................................................94 8.4.Workers’ Compensation ...................................................97 8.5.Social security donor financing in Uganda ...........................99 9.0.Challenges of the formal and Informal social security systems .....................................103 9.1.Challenges in the Formal Social Protection Systems ...........103 9.2.Challenges of informal social security ...............................107 10.The future of social security systems in Uganda .........111 11.CONCLUSIONS ..............................................................118 12.REFERENCES ..............................................................121 13.ANNEX ..............................................................137 CHALLENGES AND OPPORTUNITIES v Foreword “Everyone, as a member of society, has the right to social security and is entitled to realization, through national effort and international co- operation and in accordance with the organization and resources of each State, of the economic, social and cultural rights indispensable for his dignity and the free development of his personality.” (Universal Declaration of Human Rights Article 22) Social security, a proclaimed Human Right, is a key mechanism to ensure social and economic equality. Social inequalities are a considerable strain on any society and economy. Therefore, different forms of social security systems have been applied by nations, religious institutions, or private companies for centuries in order to mitigate the many negative effects of poverty. Internationally, it is now recognized by most countries that some form of social security mechanisms are crucial to a country’s healthy and effective social and economic development. On this background, the Konrad-Adenauer-Stiftung (KAS) is promoting the concept of Social Market Economy also internationally as a consideration and inspiration for policy makers and representatives of the private sector, who influence the economic and social development of different countries around the world. Sharing experiences in economic policy drafting and balancing state-led social security schemes with the preservations of individual and market freedoms is therefore at the core of KAS’ international efforts to strengthen the global link between economic growth and social justice. This publication addresses the situation in Uganda and provides a comprehensive presentation of the strength and weaknesses of the Ugandan social security systems. It gives an insight into the development and situation of both formal and informal security systems in Uganda and analyses the different available options as well as the remaining gaps. We hope, this publication will make a significant contribution to the complex and thriving discourse on the development of a Ugandan social security system, and wish for the deep and enriching impact the authors have envisioned. Dr. Angelika Klein, Country Representative KAS Uganda vi THE STATUS OF SOCIAL SECURITY SYSTEMS IN UGANDA List of Acronyms and Abbreviations BOU Bank of Uganda CBHIS Community Based Health Insurance Schemes CCT Conditional Cash Transfer CfW Cash for Work CSOs Civil Society Organisations DAR Development Assistance to Refugee Hosting Areas DFID Department for International Development DRT Development Research and Training EC European Commission EPRC Economic Policy Research Centre ESPP Expanding Social Protection Programme FfW Food for Work HDI Human Development Index ILO International Labour Organisation KALIP Karamoja Livelihood Programme Karamoja Integrated Disarmament and Development KIDDP Programme KPAP Karamoja Productive Assets Programme LEARN Livelihoods and Economic Recovery in Northern Areas MDG Millennium Development Goals MFPED Ministry of Finance, Planning and Economic Development MGLSD Ministry of Gender, Labour and Social Development MOH Ministry of Health MOPS Ministry of Public Service NDP National Development Plan NGOs Non-Governmental Organisations NSSF National Social Security Fund NUREP Northern Uganda Recovery Programme NUSAF Northern Uganda Social Action Fund CHALLENGES AND OPPORTUNITIES vii OPM Office of the Prime Minister OVC Orphans and Vulnerable Children PRRO Protracted Relief and Recovery Operation PSPF Public Sector Pensions Fund Restoration of Agricultural Livelihoods in Northern RALNUC Uganda SAGE Social Assistance Grants for Empowerment UBOS Uganda Bureau of Statistics UDHS Uganda Demographic and Health Survey UNHS Uganda National Household Survey VfW Voucher for Work WFP World Food Programme YLP Youth Livelihoods Programme
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