CONRIBUTIONS OF FORMAL SOCIAL SECURITY SCHEME TOWARDS WORKER’S WELFARE

A CASE STUDY OF NSSF_KINONDONI REGION DAR ES SALAAM

By

Josephat, Gerald

A dissertation Submitted in Partial Fulfillment of the requirement for Award of Bachelor Degree in Industrial Relations at the Institute of Social Work

Institute of Social Work

Dar es Salaam

June, 2015

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DECLARATION & COPYRIGHT

I, JOSEPHAT, GERALD declare that this research is my own work. It has not been submitted in any other Higher Learning Institution within and outside Tanzania for a similar or equivalent award.

Signature……………………………

Date…………………………………

All rights reserved. No part of this research may be reproduced, photographed or otherwise

without either the prior written permission of the author or the Institute of Social Work on my

behalf.

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CERTIFICATION

I certify that report entitled “the contribution of formal social security scheme towards

worker’s welfare at Kinondoni Region in Dar es Salaam, is an independent research work

carried out by JOSEPHAT, GERALD. This report has not been previously submitted for the

award of Bachelor Degree at any High Learning Institution within or outside Tanzania.

Signature…………………………Mr. Nikodemus BanyukwaSupervisorDate………………………………

DEDICATION

To my beloved Guardians Mr. and Mrs. Josephat Lucumay who raised and sent me to school and for their invaluable inspirations to my studies.

Secondly, to my siblings family of Mr. & Mrs. Lucumay for their prayers, financial support and encouragement in my studies so that I can keep be in a successful side as well as completing greatly to the research work of the present study.

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MAY GOD ALMIGHT REWARD THEM MORE

ACKNOWLEDGEMENT

Research involves interacting with people in exchanging ideas and seeking assistance and

support both moral and material. The researcher feels much grateful to those who assisted

and supported in one way or another.

First and for most, I would like to express my sincere gratitude firstly to GOD ALMIGHTY

for His Merciful and Protection in my day to day life including the time of undertaking

research work of the preset study.

Then I would like to thank my Research work Supervisor Mr.N. Banyukwa, for His tireless

work in the whole work for God’s Glory. Also special thanks’ to Head of Department of

Labour Studies, other Lecturers at Institute of Social Work for their Directives which helped

me to increase the knowledge and skills in accomplishing this research.

My gratitude also goes to my beloved classmates’ third year students’ of Bachelor Degree in

Industrial Relations of Academic year 2014/2015.

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ABSTRACT

Social security plays a vital role in socio and economic development to an individual and

national at large. This study sought to find out the contribution of formal social security

scheme towards worker’s welfare. The study was conducted in NSSF Kinondoni region, Dar

es Salaam. Both qualitative and quantitative approaches were employed using a sample of

fifty respondents who were NSSF management and workers (beneficiaries) who receive

benefits and services. The main research instruments used were questionnaire and interview.

Both qualitative and quantitative data collected were analyzed using simple descriptive

statistical methods such as frequency, percentages, figures and tabulations.

The findings revealed that despite the fact that NSSF proved to be the Centre of better and

standards benefits and services to its members, it was found that even the service offered are

still below the ILO standards and still there is numbers of opportunity to capture the gap,

NSSF policy should be newly drafted and structured, however its services coverage is largely

in the formal economy most of the workers engaged in informal economy and self-employed

are not yet covered, adequate employees financial record should well managed, and extensive

consultation with the government Institution for regulating social security matter SSRA

should be an added advantage.

On the basis of these findings, it was recommended that for the government they should make

an effort on the strategy poverty reduction through provision of social security and protection

to its large population,NSSF members should form an operatives association to focus their

interests, and also NSSF management should develop alternatives services to its members

and increase the rate of benefits so as to help workers to meet their daily livelihood.

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LIST OF ABBREVIATIONS

DEPT DepartmentNGO’s Non Governmental OrganizationILO International Labor Organization.ISW Institute of Social WorkSSRA Social Security Regulatory AuthorityNSSF National Social Security FundLHRC Legal and Human Right CentreTAMWA Tanzania Media Women AssociationCCK Chama cha KijamiiMP,s Members of ParliamentU S A United States of America

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TABLE OF CONTENTS

DECLARATION........................................................................................................................i

COPY RIGHT............................................................................................................................ii

CERTIFICATION....................................................................................................................iii

DEDICATION..........................................................................................................................iv

ACKNOWLEDGEMENT.........................................................................................................v

ABSTRACT..............................................................................................................................vi

LIST OF ABBREVIATIONS..................................................................................................vii

TABLE OF CONTENTS........................................................................................................viii

CHAPTER ONE.......................................................................................................................1

1.0 Introduction..........................................................................................................................1

1:1 Background to the Problem..................................................................................................2

1:2 Statement of the Problem.....................................................................................................5

1:3 Objectives of the Study........................................................................................................6

1:3:1 General Objective.............................................................................................................6

1:3:2 Specific Objectives...........................................................................................................6

1:3:3 Research Questions...........................................................................................................6

1:4 Significance of the study......................................................................................................6

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CHAPTER TWO.....................................................................................................................7

LITERATURE REVIEW........................................................................................................7

2:0Introduction...........................................................................................................................7

2:1 General Overview of Formal Social security Scheme.........................................................7

2:2 Theoretical Frame work of The Problem.............................................................................9

2:3 Over view of Formal Social Security Scheme in Tanzania...............................................10

2:4 Social Security Scheme in Tanzania and Problems Associated with;...............................11

2:5 Overall Challenge Facing Social Security Sector in Tanzania;.........................................13

2:6 Members Complaints on Barred Withdrawal Benefit;......................................................14

2:7 Scheme’s Financing...........................................................................................................15

2:8 Registration........................................................................................................................15

2:9 Achievement of National Security Fund............................................................................16

2:10 Challenges Facing the Fund.............................................................................................16

CHAPTER THREE...............................................................................................................18

METHODOLOGY.................................................................................................................18

3:0 Introduction........................................................................................................................18

3:1 Research design..................................................................................................................18

3:2 Area of Study.....................................................................................................................18

3:3 Study Population................................................................................................................18

3:4 Types of Data.....................................................................................................................18

3:5 Sample size (sample of the study)......................................................................................19

3:6 Sampling Technique (methods).........................................................................................19

3:7 Method of Data Collection.................................................................................................20

3:8 Questionnaire.....................................................................................................................20

3:9 Interview............................................................................................................................20

3:10 Documentation.................................................................................................................20

3:11 Data Analysis...................................................................................................................21

CHAPTER FOUR..................................................................................................................22

DATA ANALYSIS, PRESENTATION AND DISCUSSION OF THE FINDINGS........22

4.1 Introduction........................................................................................................................22

4.1.1 Data presentation.............................................................................................................22

4.1.2 Data analysis...................................................................................................................22

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4.2.1 Working experience........................................................................................................23

4.3 Verification of the Research Objectives............................................................................25

4.3.1 Research objective One...................................................................................................26

4.3.2 Research objective two...................................................................................................28

4.3.3 Research Objective Three...............................................................................................30

CHAPTER FIVE....................................................................................................................32

SUMMARY, CONCLUSION AND RECOMMENDATION............................................32

5.0 Introduction........................................................................................................................32

5.1 Summaries..........................................................................................................................32

5.2 Conclusion..........................................................................................................................33

5.3 Recommendations..............................................................................................................33

5.3.1 Recommendation to the NSSF members........................................................................33

5.3.2 Recommendation to the Government..............................................................................34

5.3.3 Recommendation to the NSSF management...................................................................34

REFERENCES.........................................................................................................................35

APPENDIX “A”.......................................................................................................................37

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CHAPTER ONEINTRODUCTION AND BACKROUND TO THE PROBLEM

1.1 Introduction Social security means that it is any kind of collective measures or activities designed to

ensure that members of the society meet their basic needs and protect from contingencies

enabling them to maintain the standards of living consistent with social norms.(Dau 2003:1)

In a broader sense social security provided that the protection measures which scheme

provided for its members, through a series of public measures against economic and social

distress that will results to be caused by stoppage or substantial reduction of earnings

resulted from sickness, maternity, un employment, dis abilities, old age, death, or any other

kind of employment injury. Furthermore, the schemes are also responsible for the provisions

of medical care’s subsides for their families with children (ILO: 1984).

During the 19th C, in the early period of industrialization most of the workmen’s started to be

more dependent upon wage employment, the working society become more dependent upon

wage employment, the workmen’s desired the life of work to be industrialized too, so the

social security has been with time to time from the traditional ways of security to modern

ones, so as it was reached in 19th C the workmen’s society was no longer possible for them to

depends on the traditional system of social security they need to cope with the existing

challenge of socio-economic issues brought by globalization.

The study critically is going so far to analyze the contributions of formal social security in

promoting welfares in Tanzania. The case study will be covered at either any one of the

social security Office.

The report of international labour standard organization on the world coverage of social

security statistical monitoring of the state and developments of social security in the world, it

present the knowledge available on social security coverage in different parts of the world

and examine the scale of the countries’ investment in social security in the context of

economic crisis, although a social security is a human right, only the minority population of

the world enjoy that right while the majority lacks comprehensive and adequate coverage

and it cover about one third of the population.

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In sub-Saharan Africa and south Asia, the numbers of people with access to even the most

rudimentary protection is estimated to be less than ten percent.

1:2 Background to the ProblemCurrently, in recent years much effort has been done to the formations and reforms of social

security systems in the developed nation and developing nations respectively.

In that sense the debates and discussions has been centered on the questions of what kind of

services to be provided in terms of social security that could be appropriate and standards in

the growing and rapidly change of the economic and social structure environment globally.

In terms of developed nations more than 90% of the populations are almost covered by the

social security systems. In developing countries despite consider the effort on parts of

policymaker’s, development institution and donor agencies well cover about 50% of the

entire populations this implies that it’s a half/ half game , in that manner the remain 50%

remains uncovered in terms of social security service benefits hence there is great possibility

of fallen to risks and socio-economic contingencies

Fallen to risks therefore being a major and commonly threats in the day to day life of the

people in developing countries especially in sub-Saharan countries, facing different numbers

of social and economic problems like, disability, illness, death, natural disaster and other

social and economic distress and fluctuating incomes of the individuals and the problems of

unemployment, child and old age are therefore affect the quality of life. (Johannes; 1999:1)

Early in 1883 Councilor Otto Von Bismarck the reign of Germany in those old days

introduced government of financed social insurance, under that strategic plans as a means of

social security services aimed to provide the services for the employees who get sick and

could not engage in the productions, and receive a medical cares benefits and cash benefits

from which it was found that both employees and employers were contributors to that

scheme. Way forward in 1889 the law was amended and passed in Germany granting a

pensions virtually to all Germany workers at the age of 70’s years, Bismarck social insurance

scheme was firstly to be introduced in Germany, it ,mark the initial point of the development

of social security scheme in Germany. However it was the US, President Honorable

Roosevelt who converts a philosophy of the welfares state inspired party by the theoretical

work of John Maynard Kegnes and partly by experience of government action in the e first

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world war one (WWI) and the recession of the1914- 1918, and later on the great economic

depression of the years 1929-1933 which gave the rise of serious debates and various

discussions over economic policy plan to reduce the numbers of economic and social

miseries.

Although the concept of social security systems in developed nations grew rapidly after the

world war two (WWII), many Europeans countries introduced different social security

schemes and made reforms of employment benefits and various social assistance to re -

establish individuals reforms thought was being threatened by the existing policies. Social

security systems are complex in its nature since it requires a lot of resources and

techniqualities to handle the duty ( Jacques D;2007:2)

In England, the development of social security systems can be traced as far as back from the

period of industrial revolutions, during the industrial revolutions era there were increased

numbers of beggars of the decentralization of the family and kingship system which provided

the security needs and welfares to vulnerable groups such as old age, children’s, and disabled,

there was numbers of associations established to offers the security protections in the society.

Social security Act of 1935 was one of the responses the economic crisis. The legislation

established the modern centralized US, pension system with provisions covered the old age

people pensions, survival benefits, disability benefits, unemployment programs and support

the families with dependent children’s. Sometime the social security scheme was founded out

of the current revenue of a country raised through “a pay as you go” payroll tax system.

In developed nations , social security covers workers and their dependants against old age,

unemployment, health and medical cares and other risks are cured ,while in developing

nations the formal social security scheme system covers workers of formal sectors, workers

are the privilege groups provided with social security benefits and to some extent poor have

access to social assistance and social disaster services or help like flood, fire, earthquake’s,

and the volcanic eruptions but the remaining large populations are surely not covered (Jean

D;2007:3).

However the fact that in sub-Saharan Africa around 50% society live in extreme poverty,

shown under the current statistics, social security in Africa should first and for mostly

address the main social problems of continent at large, it should be well known that social

security transfers whether in kinds or in cash is the only solutions or tools to reduce extreme

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poverty, social insecurity and the socio-economic miseries at all stages level of economic

life cycle of a particular nation, If well managed governed effectively it work immediately to

combat poverty (Ruck M;2005:4)

ILO shown that due to level of economic status of many of Africans state being low but most

of the Africans countries could even afford to provide the modest levels of universal social

protection consisting of at least basic social security protections like health cares access, free

education and the basic universal pensions in case of old age, invalidity and survival (ILO;

2004:1).

The statistic shows that population of Tanzania is about 40 million recently. Out of these 70%

are found in rural areas, while the rest are in urban areas .And the total numbers of the labour

force in the Tanzania are estimated to about 16% millions, the mandatory formal social

security system covered about 2.7%milions and the 94% of the capable workforce are

engaged themselves in the informal sectors mostly in Agricultural sector in both rural and

urban (Social security Policy; 2003:5).

In 1964 Nyerere, the first president of Tanganyika enacted the National Provident fund

(cap564 of the law) to provide for the contributions and payment of the benefits of the

retirements, death, invalidity, and in case of sickness. It is a philosophy of the welfares for all

the Tanzanians including both women and men, children’s and the old age, and the disable

people living in the peace and unity which was characterized the most dominant vision and

mission of the Late Mwalimu J. K. Nyerere.

However well before independence social security system existed in Tanzania before where

by various policies statement have been created and some acts were amended regard the

protections and security of the entire society against socio-economic contingencies like

injury, old age and the loss of employment, just to mentions in few includes Master and

Native Ordinance of 1923 as well amended in the year 1954 respective, The Provident Fund

Ordinance of 1942, The Local Authority Provident Fund cap.53 of 1944, The workmen’s

Compensations Ordinance cap.262 as amended in the late year 1963 respectively.

So after the Independence the system of social security protections in Tanzania has not be

static it was changing time to time so as to suit with the currently existing environment, new

policies were formulated like The National Social Security Policy of 2003, also there was

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institution formed purposeful to regulates the social security scheme like Social security

Regulatory Authority (made under section 6 and 36 of the social security (regulatory

Authority) Act no.8 of 2008 as amended.

In this context that social security takes the center theme of the socio-economic policy and

rules formulated, and the policy makers have to be competent enough of the understandings

of the role of the social security systems in the socio-economic development at large and

there is a direct link between the social and economic development one can’t be achieved

without the other it is a complimentary objective in that sense (Rwegoshora; 2000).

1:3 Statement of the ProblemThe establishment of social security scheme systems in Tanzania can help to a great extent in

the reduction of poverty to entire nation at large, due to different kind of services offered like

injury benefit, old age pensions, maternity benefits and other services in terms of social

assistance provided to by the government to its citizens and among almost kind of services

are provided under the existing formal social security schemes but the problems comes in

terms of scope coverage and to what extent the benefits are provided.

However the methods of providing these services differed from one another scheme, from

one country another but we found that there are common kind of services provided under

these scheme provided that they both aimed at improving the quality standard of livings such

as employment injury, health insurance, maternity benefits, also the compulsory and

voluntary social assistance of which are offered by different numbers of social security

scheme in Tanzania like, NSSF,PSPF, LAPF, NHIF, GEPF, and PPF to its members.

So the central theme of the study needs a Researcher to analyze critically what’sexactly

kinds of benefits are NSSF provided to its registered members , if the services offered is

satisfied to the members and at the end of the study the will gives the readers the intellectuals

mind and knowledgeof the contributions of formal social security scheme towards the

welfares of workers and the entire society at large, and the study is to answers several

numbers of questions which have not yet been covered by the previous studies.

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1:4 Objectives of the Study

1:4:1 General ObjectiveTo find out the contributions of formal social security scheme in promoting workers welfare

in Tanzania. A case study of NSSF –Kinondoni region, Dar es Salaam

1:4:2 Specific Objectives1. To explores kinds of services provided by NSSF to its members

2. To measures members satisfaction to the services rendered by NSSF

3. To investigate problems which hinder the effective provision of social security services to

its members.

1:4:3 Research Questions1. What kinds of services are provided by NSSF to its members?

2. Do the services rendered by NSSF satisfy its members?

3. What are the problems hindering the effective provisions of social security services to its

members?

1:5 Significance of the studyThe firstly important significance of this study is to help a student in the partial fulfillment of

the award in bachelor degree in industrial relations.

The study also goes to identify the unfulfilled research gap by the other previously researcher

concerning on the same field, hence come up with some new ideas, views and suggestions to

combats the problems.

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CHAPTER TWO

LITERATURE REVIEW

2:1 IntroductionThe National Social Security Fund (NSSF) was established by the Act of Parliament No.28 of

1997 to replace the defunct National Provident Fund (NPF). NSSF is a compulsory scheme

providing a wider range of benefits which are based on internationally accepted standards. A

literature review is an account of what has been published on a topic by accredited scholars

and researchers. In writing the literature review, your purpose is to convey to your reader

what knowledge and ideas have been established on a topic, and what their strengths and

weaknesses are. As a piece of writing, the literature review must be defined by a guiding

concept (e.g., your research objective, the problem or issue you’re discussing or your

argumentative thesis), with the aim to seeking information related to your area of study (Dena

Taylor: 2000)

2:2 General Overview of Formal Social security SchemeIn a year 1939 social security benefits were expanded to a retired workers, spouses and minor

children, In 1956 to severely disabled workers, these extensions helped to cover more people

in need. (Joseph L; 2007:6)

Social security schemes are the results which have been achieved by comprehensive and

successfully series public measures for protecting them from the economic and social

distress. And the absence of that measures could be caused by the stoppage of earnings in

time of sickness, old age, invalidity, unemployment, maternity and after bread winner, the

public provides the medical care’s as needed to the children’s and other needs of the

subsidiary families by bringing up the young children.

When Franklin Roosevelt signed the social security act, into the law, there was absolutely no

administrative infrastructure to put the old age insurance program into operation. Thus,

between August 1935 and January 1937, mechanisms had to be developed to collect taxes

and track the earnings of the workers for determination of benefits. The social security Act of

1935 made it clear that the financing of the program was through “tax” mechanisms.

(Sylvester; 1999:43).

The western concept of Social Security has greatly influenced the discourse about social

security. The ILO was for a long time the only existing instruments institutional agency with

academic capacities as well as field experience in designing state organized thus, social

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security has been dominated International debate. In fact the understanding of social security

as referring to mainly specific public program involving. Social assistance, social insurance

and re-distribution is based on the experience and situation in developed countries.

(Kotlikoff; 1987:132).

Many of industrialized nations like the United State (U.S.A) has instituted the programs to

help the individuals face the uncertainty brought on by the disability and the old age and the

structure of these programs were initially shaped by the important social, economic and

demographic changes that rendered the traditional systems of economic security increasingly

jobless(Michael D;2004:14).

Up the 1930’s the regulations governing the security of employed persons and old age and

was applied in certain European Employers. The regulation for African employees was

passed in 1932 with the pension Ordinance which provided the payment of old age pensions

for holder of high position in the public services, then ten years later on 1st of Nov, 1942 the

Provident Fund “Government Employees” was passed in to establish a provident fund to

cater for public servants. This Provident Fund provides payment in a case of Invalidity, old

age and other cases of premature termination of employment.

The general outlook of social security in England their program has been divided into two

parts, thus, is a public assistance which includes housing, medical care, Health services and

so on. Another part is a comprehensive Social Insurance system which is for economic

hazards, old age, death and disability.

The main aims of these schemes was to protect the workers from the risks such as sickness,

maternity, death and old age, the features of these contingencies is that, they tend to imperfect

the ability of a worker to support himself and hid dependents in the health and decency, And

all these are the welfares of workers in any society that each scheme should provide to their

members.

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2:3 Theoretical Frame work of The ProblemThe term theory refers to a set of reasoned ideas intending to explain facts of an event, it

encompasses a set of assumptions and concepts irrelatively abstract of inquiry distinguished

from empirical research (Lane, 1996). Using a theory in the study it’s normally limiting the

scope of events to be considered or described in the phenomena, Theoretical frame give a

researcher more prediction that may be tested by his data. Thus theoretical framework of

social security is thus rotated to the many of the ideas based on human dignity and to the

social justice to a large extent, of which is very common network of all definition and

concept by different people (Individuals), MP’s, Independent institution, various ideas from

different researcher, Trade unions discussion, and a State responsiveness to the entire

community on the needs and adjustment of social justice

Theoretical framework is an important part of the research since it offers the basic insights

and perspectives that inform a particular research.

Researcher reviewed various literatures and publications which guided him on a conceptual

frame work to build his own theoretical views and analysis .Citing from magazines,

newspapers, brochures, previous researchers, Annual report from NSSF, ILO Reports, SSRA

publications, The National Social security policy of January (2003) Blogs, Government

Bureau of statistics, together with Tanzanian Parliamentary discussions and presentation

made it possible and basis in drawing conclusion of this study.

Therefore the theoretical of social security is related to the idea of human dignity and that of

social justice in the alleviation of poverty in the society. Three tiers aimed to seek and

effective utilization of various funding resources (National wealth) for the better protection of

the entire country population (ILO; 1994:57). Furthermore the study has been guided by ILO

minimum standard. International Labor Organization set an instrument which was adopted at

its 35th session in June 1952, popular known as social security( Minimum standards)

Convention No.102 itemized numbers of contingencies and benefit required in the minimum

standards convention includes, Old age, Invalidity, Survivorship, Employment injury,

Maternity, Medical care, sickness, Unemployment and Death.

Frame work of social security is thus guided on three tier system, this structure includes the

followings:-

According to ILO framework, three tier systems is arrangement/system designed to cater for

different needs of protection for different categories of people depending on their level of

9

incomes. Tier one, which is financed by the government, caters for those who are not able to

purchase social security services; e.g., sick, disabled, elderly and possible group to fallen

under risk. Tier two caters for those who can contribute and is compulsory and supervised by

the government. Tier three caters for those who can afford to supplement their tier two

security by purchasing commercial insurance benefits. Tier three is voluntary and privately

managed. Three tier system is designed to reduce the government expenditure in on social

assistance/security programs through expansion of coverage of Tier two and three.

In Tanzania the most dominant scheme is social insurance due to low economic capability of

the government to issue free coverage to all its citizens, however there are some basic steps

that the government is taking care of like free primary education and health cares to the elders

though it is not practiced adequately. One of the major role of social security scheme is

provisions of social protections and income security for members and basic needs to all

citizens. In African countries has not been possible. Ackson, (2010) Revealed that in

Tanzania it is only 6% of the working force that are covered. In Global statistics, ILO,

(2010/11) presented that by the year 2010 coverage was 50% of the entire world population.

However from that group only 20% enjoy adequate coverage, the main reason for this poor

coverage is said to be a rescission of the informal sector which is the majority in all countries

especially in developing ones. While attending this challenge, other issues like poor countries

policy, increasingly demographic of the ageing, extended family structure, economic

globalization and environmental development raises more challenges to social security

scheme.

2:4 Over view of Formal Social Security Scheme in TanzaniaTanzania has being one of the British Colony has adopted some laws and procedures from the

English common law, judicature and the application of laws Ordinance cap.No.453 of 1961

and Indian civil procedure of 1908. This implies that the formal social security system has to

be categorized into two groups.

The first one is the pensionable officers who are the government employees. And the second

one is the non-pensionable officers who make contributions to the fund. It includes both

employers and employees contributions.

Formal social security scheme operating under the principle of compulsory savings and social

insurance are financed either through bipartite or tripartite contributions from employees,

employers and the government on the regular basis.

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Formal social security scheme is a regulated mechanism of protecting citizens against

contingencies. This system existed in Tanzania well before independence whereby various

policy statement have been made and Acts passed regard to the protection of the entire

population in the country against contingencies like injury, loss of employment and old age.

These includes Master and Native Ordinance of 1923 as amended in 1954, The Provident

Fund Ordinance of 1942, Government Employers provident fund cap.51 of 1948 as amended

in the year 1962 and the Workmen’s Compensation ordinance cap.262 of the year 1948

After the independence new legislation were enacted and others amended. These include the

statutory severance allowance of 1962(S.A). The National Provident Fund Act of 1964,(NPF)

as amended by Act No.2 of 1975 which was later repealed and replaced by the National

Social Security Fund Act No.28 of 1997(NSSF), the Public Service Retirement Act of

1999(PSR) and National Health Insurance Fund, Act. No.8 of 1999(NHIF). These

legislations passed before and after independence are devoted to the coverage of formal

sector while informal sector left out (Dau R; 2003:3)

2:5 Social Security Scheme in Tanzania and Problems Associated with; It is argued that in pre-colonial before the coming of the colonialism, there was various

society with different kind and forms of social security protection like any other countries

Tanzania had a strong informal and traditional social security system built on family and or/

community support. In time of contingencies such as famine, diseases and old age,

individuals has depended on family, clan members and members of the community for

assistance in the form of cash or in kind. While it recognized that over time traditional social

security system has tended to decay and change forms in response to the forces of

urbanization and industrialization, there is

evidence that in Tanzania family and community social support system has remained as

means of social security within different social groups.

Over time socio-economic reforms have slowly resulted into disintegration of the family

based social security protection leading to the formation of self-help groups such as UPATU,

UMASIDA and VIBINDO currently popular known. (NSSP, 2003)

The formal social security schemes seen today are revealed by Eckert(2004) who says are the

product of colonialism introduced to save some interests of Europeans and few elite Tanzania

who working for the colonial government.

11

However, Barya (2011) learned that Tanzania, Kenya and Uganda did not change much the

social security system inherited from the colonial despites all the shortfalls these schemes

embraced. He further learned that this is a main reasons why the schemes we have today have

many shortfalls. I agree on Barya, (2011) that it was not necessary to change these schemes to

fit our environment that could take challenges of our present society needs. However it was

difficult to have a universal scheme by the government due to poor economic capability of

our country.

Currently we have National Social Security Policy (2003) which considers social and

economic changes occurring in the country and liberalizes this sector in Tanzania. The re-

formation, re-organized activities of social security providers to act in response to the market

demands considering free market economy.

It is believed that despite the fact that having a number of available social security schemes,

coverage is still very poor. Baruti (2007), sees that Tanzania has potential opportunity to be

covered by the schemes available. However it is only of recent effort the government has

intervened to extend coverage with informal sectors which is considered a green pasture of all

schemes. Although Baruti (2007) Advocates potential opportunity but he is not mentioning

strategy to be employed to add the omitted ones. He also has not identified how the peoples

in the informal sectors could be handled with matters concerning compliances. This group is

so difficult to maintain because of the nature of their business and none existence of the

permanent business place. Indeed this sector is very potential but needs cares on how to

handle.

Maghimbi at el, (2002), recognized that opportunity available for social security in Tanzania

has not yet be covered well by any of the schemes in the country. He further identified that

social security schemes in the country has failed to contribute equitable economic growth and

are there to flourish the rich out of the sweat of poor members of these schemes. His eye

marking things like credit granted to some of the business people from contribution made by

the poor members and other investments made which are utilized by well off people leaving

the poor members not enjoying their sweats. The above statement is true to some extent,

however, investment made by these schemes apart from offering employment they are also

contribute to the GDP and thus contributed to the economic growth of the country. Beautiful

buildings erected attract investment and more business at the same time offer employment

12

during constructions, Maghimbi at el, (2002) suggested that members should be given first

priority when it comes to credits facilities.

2:6 Overall Challenge Facing Social Security Sector in Tanzania;Overall management and administration of social security fund are vested to the board of

trustees and the director general all appointed by the government through the responsible

ministry. Due to this there is excessive government control over the schemes in issues

relating to investment decision and expenditures NSSF. Act no.28 1997. Grandiose

investments made by this sector in favor of government interested can be seen in University

of Dodoma, Machinga complex,Ilala, police and military houses, all are none performing

project as revealed by CAG Report,(2012).

Actuarial evaluation made by ILO (2004) in respect of NSSF for the year 2002 depicted very

high administrative expenditures 22% of the fund’s income whereby the required amount is

less than 15%. This problem could be arrested by merging some of the NSSF Department

with similar functions, reducing number of office at district level, and investing heavily on

computerization to improve efficiency and increase control. This will strengthen services

delivery and attracts more members that will increase fund financial position and arrest the

problems of poor record keeping that causes dalliance on benefit provisions which discourage

members.

There is lack of another problem of interactions between schemes. Members cannot move

from one scheme another (lack of portability). This is a really problem since there are

members like non pension government employees who are members of NSSF cannot shift

their money and credit to PSPF when qualified for registration with PSPF.

The last identified challenge is that of pension schemes in Tanzania savings only working

elite leaving the majority in the informal sector uncovered, there are no strategic for

substantial public campaign on understanding importance of social security and formalization

of the informal sector so that could be easily to taken in the scheme. These if taken inn are the

majority and could flourish the scheme.

Researcher identified that there is a need of NSSF to maintain their future financial

sustainability of the scheme. In doing this it is mandatory to increase retirement age, increase

contribution amount, put inn aggressive means to register informal sector and invest only on

viable project with high yield but of short terms to cover short terms liquidities and priories

given to members who are the primary focus.

13

2:7 Members Complaints on Barred Withdrawal Benefit;Confining withdrawal benefits could not be accepted by majority of members of social

security schemes all over the country, particularly those in private. The Citizen 26 July 2012

report from Mwanza that over 600 employees from seven major gold mines in the lake zone

have resigned following amended law to confine withdrawal from social security. Other 4000

have submitted resignation letters to their employers, appalled by the new imposed

pensioner’s law as revealed by the citizen 26 July 2012.

Some social security scheme members were of the opinion that the policy change would

disrupt their life plans once they get out of job, they expect to use their money from their

social security scheme to support their families. They complaint that what they got from

employment is hand to mouth and they have nothing left for savings other contributions made

to social security schemes. Also they do not expect to get the job anywhere else after being

laid off from the current job they have and are plan to run minor entrepreneurship business as

the only means to earn means of leaving. This is why they received such an announcement

with anger. The Citizens 28 July 2012.

Other actors than members of social security scheme that have intervened to discourage the

government from implementing this policy. Trade Union Congress of Tanzania (TUCTA)

told their members that although they have no power to reverse the law suspending

withdrawal of benefits in social security schemes before members attained the age of 55 as a

voluntary and 60 years as compulsory will help placing arguments in court for restriction of

its operational. The Guardian 24thJuly 2012

The issue was also captured by LHRC, TAMWA and Scholars Tanzania July, 26 2012. The

government has already committed to liberalize social security sector, which for years

covered only people in formal employment. Today schemes are obliged to let the member’s

free to decide on which scheme to join and in matter like when one want to withdraw and or

loans. The liberalization is expected to bring in private players who will also venture into

modes of schemes operations. Daily News, (21 September 2010).

Some members wrote in magazine whether SSRA acted on workers interests or on

government, according, to them quashing withdrawal benefits brings in high risks of poverty

within the society since Tanzania does not have any other formal safety net program for a

persons who are jobless. They confess that most of Tanzanians and especially those in non-

government are on contractual terms of short period like six months or even less and after

14

completion of their contracts they wish to establish their own business from savings they

made at social security schemes and quit employment permanently. The Citizens, 05 August

2012.

The Citizen (30 July 2012). Wrote that opposition party Civic United Front (CUF) and

Chama cha Kijamii (CCK) have been noticed mocking jointly against recently changes to the

social security funds laws as being oppressive and non-considerate to workers. The two

called the government to immediately prepare a bill and table in the parliament for

reinstatement of the laws and reverts to the original state of free members withdraw;they

further complained that many workers would be affected if blocked from accessing their

social security contributions, “The government should not play with people’s money”. The

law should be changed immediately but if the government refuse to amend the law, the

parties would go to court to seek redress.

2:8 Scheme’s FinancingThe scheme is financed through contributions at the rate of 20% of employee’s salary. The

employer is required to deduct from emp0loyee’s gross salary the amount of contribution not

exceeding 10% of the employee’s salary. The employer adds the remaining balance to make

the required contribution rate of 20%

2:9 RegistrationThe national Social Security Fund Act No.28 of 1997 provides for registration of both

employers and employees. Section 11(I) of the Act provides that every employer, unless such

employer has been registered under the existing fund, shall register with the NSSF within one

month. The period of one month begins upon the commencement of the Act or the date when

the concerned person becomes a contributing employer.

The registration of employees is provided under Section 11(6) of the Act. The Section

provides that every contributing employer who is registered by the NSSF shall registered as

an insured person every person who is employee in his firm by notifying the Director General

of the particulars of such employees as may be prescribed . The registered insured person

automatically becomes a member of the Fund.

Registration of an employer and employees must be done first before payment of

contributions begins and the activity is accomplished at NSSF field offices.

15

2:10 Achievement of National Security FundThe fund participated in community development in various social activities in the country

which brought about development to the entire nation, and these social activities are as

follows;

a) The Fund donated various hospital facilities and equipment’s in the country, for

instance in the year 2004,March during the NSSF week which was held in Dar es

salaam the funds provided deliver beds and weighing scale at Mwananyamala hospital

all having the value of not less than Tshs. 20million.

b) Also fund provided for food, cooking oil, and clothing to various disabled groups in

different stations in 21 regions in Tanzania mainland (Annual report NSSF

2003/2004)

c) Fund also donated about Tshs.219 million was issued out to financing the

Construction of Mkuranga Hospital building, the donation was directly linked with

the financing of the buildings constructions and, x-ray room and diagnosis room, all

these expenses was donated by NSSF hence it’s a development on a Healthy sector in

the country.

d) Again, NSSF supported Tanzania Youth Association Trust Fund to instill more

awareness on the youth who are greatly affected by the HIV/AIDS, not only that but

the fund support the trainers to educate the society from the prevention of HIV/AIDS.

e) The fund furthermore donate amounting of about Tshs. 61 million for the

constructions of the buildings of school in the country, and pay school fees for few

numbers of students who have been selected to join with the secondary education but

their parents could not afford the expenses.

f) Also NSSF succeeded to build hostel block of Mabibo Hostel of the University of Dar

es salaam (UDSM) which accommodates many of the students arrived for their course

at the university, and hostel blocks of University of Dodoma (UDOM).

g) Furthermore, NSSF is on the progress to building Kigamboni Bridge as a means of

transport for the people who across Kigamboni, although the project is not yet started

but things are well arranged and soon the project will start.

2:11 Challenges Facing the Fund(a) Delayed Remittance of contribution

This one among the challenge facing the fund whereby it’s a big problem, this comes

when the contributing employers delay to submit the amount to the NSSF Office

16

hence affect the fund operations, hence the fund have to take legal action or measures

against the employers who commit such an act.

(b) Competition

This has brought due to the liberalization of the social security system in the country,

these schemes are having their own laws which make them to enter into the same

nature of the market economy, this brought about stiff challenge to the NSSF, and

however competition should be there.

(c) Withdrawal

This is another big challenge which has been on discussion within the Parliamentary

House, different trade unions like TUCTA,NSSF members and other, where by it

comes when the members terminated from their previous employment or resign they

need to have their sum amount they contributed to the fund to be provided with the

withdrawal benefit but the scheme does not do so, and the country has remove such

benefit, so it is from this point where the fund receive a lot of complaints it’s a

challenge to the fund.

(d) Despite several effort made by the government to put a minimum salary to different

categories of workers some employers are still continue to pay even a little wage than

what has been stipulated in the law, consequently this has further resulted to the low

level of contributions to the fund.

(e) HIV/AIDS and Malaria

In recent years HIV/AIDS has becoming more perpetuated to the society sometime

the members of the NSSF found themselves to be affected by the disease and led to

over increasing number of the survivors who qualify for the payment of the survivor

benefits pensions, if the epidemic is not cured well very soon, a lot of the resources

will be used to pay for the survivors hence will led to the unsustainability of the fund

and gradual decline

17

CHAPTER THREE

METHODOLOGY

3:1 IntroductionResearch methodology is a very significant part for a researcher to know the methodology

used to study a particular problem. It show the direct of how the researcher will conduct form

initial stage of data analysis and presentation of materials (Kothari C.R; 1990)

In this chapter researcher explores enough information to answer some of the question. This

chapter is intended to include, research design, scope of the study, study population, sample

size, method of data collection, data collection technique, data analysis and study limitation

3:2 Research designResearch design is a conceptual structure within, which research is conducted, constitutes a

blue print for the collection, measurement, analysis of data. Therefore these help to facilitate

the process of undertaking the research process so that it can yield the maximum information,

with minimum expenditure in time and also money (Kothari C.R; 2000:120)

Basically there are different types of research design these include the following; exploratory

design, case study design, descriptive design and diagnostic design. Researcher was used a

case study design as a method of getting information in the working community.

3:3 Area of StudyThis simply is a geographical location where the study was carried out. In that sense, the

study was conducted at National Social Security Fund (NSSF), at Dar es salaam

3:4 Study PopulationStudy population (target population) is concerned with one to which a researcher would like

to generalize his results (Rwegoshora 2006:114) and on the other side according to (Ahuja R;

2001:156) Target population is the one which includes all the units (persons) for which the

information is required

Therefore the target population for this study was the stuffs, subordinates and the members of

the National Social Security Fund, at Dar es Salaam.

3:5 Types of DataThe study was conducted by surveying method, through two sources of information which

are primary data and Secondary data

18

“Primary Data (source)” is the first handed information which has not been worked before.

The researcher collects information or data that have not been previously collected through

various methods such as observation.

“Secondary Data” (source) is the second handed information which have been already

worked upon by other researchers in the previous study

A researcher collects information’s or data from the library especially books, journals,

encyclopedia, NSSF Manual Guide and newspaper

Furthermore, the data was obtained through by looking the records of NSSF members in each

year from 2011/2012 and functions of NSSF in the entire society

The study used both sources of data collection which was primary data source and secondary

data source.

3:6 Sample size (sample of the study)Sample is a position of people drawn from a larger population, it will be representative of the

population only, it has the same basic characteristics population from which it is drawn

(Ahuja R; 2001:155)

Under this study 50 respondents were selected by using simple random sampling and

purposive/judgmental sampling from a total number of a workforce

Table 3:1 categorization of the study respondents

Respondents Male Female Total

Department(mgmt.) 5 5 10

Subordinates 10 10 20

NSSF members 10 10 20

Total 25 25 50

Source: Research Findings, 2015

3:7 Sampling Technique (methods)Sampling methods are techniques plan which drawn from the total population, be studied and

then extend the findings about the sample to the entire population (RAM, A; 2001)

Simple random sampling and purposive (judgmental) sampling technique were applied under

this study, consequently the simple random sampling (convenience sampling method) used

19

especially to the subordinates (workers) while purposive sampling used to the departments

(Management of NSSF)

3:8 Method of Data Collection Under this study, Researcher used different methods to obtain data and information. Most of

the information was obtained through interview, questionnaire and documentary review.

3:9 QuestionnaireQuestionnaires are commonly used to obtain important information about the population.

Each item in the questionnaire is developed to address a specific objectives, research

questions or hypothesis of the study. Researcher must also know how information obtained

from each questionnaire item will be analyzed (Mugenda O; 1999:71)

Researcher used both types of questionnaire that is closed questionnaires and open-ended

questionnaire. All these used to the respondents who were selected through simple random

sampling and purposive sampling. This method was very important for its ability to collect

data in large amount and also has a wider coverage. Questionnaire gives the respondents

greater freedom of expressing their various views and opinions towards a certain problem.

3:10 InterviewAn interview is an oral administration of a questionnaires or an interview schedule.

Interviews are therefore face to face encounter. It is a verbal interaction between the

researcher and the respondents. Interview can either be structured or unstructured where a set

of predetermined questions were used. To obtain accurate information through interview, a

researcher needs to obtain the maximum cooperation from its respondents (Mugenda

1999:83)

In this study a researcher was opted to use unstructured interview simply because of its

advantage on flexibility, clarify and appropriateness. It is a method which is commonly used

to get deeper information and giving data to meets the study objectives

3:11 DocumentationIt is a process of reviewing some written materials in different bears like in libraries. Some

information was obtained through readings books, journals, magazines and newspaper

especially the Guardian and the Citizen.

Researcher also was in position to utilize documentary review method in order to get

different information. Therefore different documents from NSSF office like annual report,

20

manual guidelines were get reviewed by a researcher to obtained the required data for the

accomplishment of the problem under study.

3:12 Data AnalysisAfter data has been gathered from the respondents, they were coded analyzed and presented

through the use of the simplest calculation and then be presented in the form of tables,

figures, frequency, percentage and pie charts. The level of analysis regarding the above

depended on the nature and different perspectives given to determine its validity of data

Both qualitative and quantitative methods were used in this study. Qualitative method (data)

tested by determining its validity and the relationship with some variables of the research

problem

Quantitative method (data) also was usefully critically examined by the computations, so that

to test the validity of those data with variables in determining the data collected whether there

is a relationship or if differences, if any.

3.13 Limitation of the study

During this study, a researcher encountered a problem of financial. Financial constraints

which imply that a researcher faced a critical shortage of funds, the obtained funds were not

sufficient enough to cover the required costs for data collection such as transport, photocopy,

printing, typing and binding.

21

CHAPTER FOUR

DATA ANALYSIS, PRESENTATION AND DISCUSSION OF THE RESEARCH

FINDINGS

4.1 Introduction

This chapter deals with the presentation, analysis and discussion of the findings. This study

was carried out to “To find out the contributions of formal social security scheme in

promoting workers welfares in Tanzania”. A case study of NSSF, Kinondoni region, Dar es

salaam. As to present the findings obtained from the field this chapter is divided into five

sections. Section 4.1 presents the introduction on this chapter while Section 4.2 displays the

different characteristics of the respondents under study. Again section 4.3 explores the

response on the services provided by the NSSF. Furthermore section 4.4 of this chapter

present the satisfaction/ dissatisfaction of the services rendered by the NSSF and lastly

Section 4.5 shows about the problems which hinder the effective provision of the services

rendered by NSSF respectively.

4.2 Key characteristics of the respondents

The purpose of this part is to present the characteristics of the intended respondents based on

sex/gender, duration of employment (years of working experience), age, department and

education qualifications.

4.2.1 Sex of the respondents

Sex of the respondents was very vital in this research simply because it assure the gender

balance to both man and women so as to avoid bias. The findings on sex of respondents are

presented in table 4.1 below:

Table 4.1 Respondents according to their sex

Respondents Male Female Total Percent

NSSF mgt 5 5 10 20

NSSF surbdnt 10 10 20 40

NSSF members 10 10 20 40

Total 25 25 50 100

Source: Field data, 2015

22

Table 4.1 above indicated out of 50 respondents 10 (20%) were from NSSF management in

which five of them were male and another five were female, 20 (40%), Subordinates in which

ten of them were male and another ten was female, and 20 (40%) members of NSSF in which

ten was male another ten was for female. This implies that there was equal ratio between

male and their counterpart involved in this study purposely to avoid gender bias.

4.2.2 Age category of the respondents

Age category of the respondents was also very potential in study in order to know the most

reached age of the respondents. The findings are presented in table 4.3 below:

Table 4.2 Distribution of respondents according to age

Age category Frequency Percent

25 – 35 19 38

36 – 45 20 40

51 and Above 11 22

Total 50 100

Source: Field data, 2015

Findings revealed that out of 50 respondents 19 (38%) were at age category of 25 to 35, while

respondents 20 (40%) were at age category between 36 to 45, and respondents 11 (22%) fell

at the age category of above 51years. This implies that the respondents with age category

between 36 and 45 were reached by a researcher and were more involved in the study.

4.2.3 Education levels of the respondents

This part was very potential so as to measures if the respondents under the study have enough

understanding, educated to be involved in the discussion under study. The findings are

presented in table 4.3 below:

Table 4.3 Education levels of respondents

23

Education level Frequency Percent

Diploma 10 20

Degree 20 40

Postgraduate 10 20

Master & above 10 20

Total 50 100

Source: Field data, 2015

Table 4.3 above indicated that out of 50 respondents 10 (20%) were having diploma, 20

(40%) attained degree level of education, respondents 10 (20%) attained postgraduate degree,

furthermore respondents 10 (20%) qualified above master’s degree. This implies that in

general all respondents were educated and having understanding on social security affairs but

respondents with degree level were more involved in dealing with the social security matters.

Also implies a researcher target respondents with different level of education.

4.3 Kinds of services provided by NSSF to its members

4.3.1 Services provided by NSSF

The welfares of the workers depend a lot to the scheme registered and verified to them. For

instance the National social security Fund (NSSF) members served at the extent that, every

member enjoy on the types and kinds of ingredients concerning income and other benefits

than those under the other scheme like LAPF,PPF and the alike. Under the NSSF there are

about seven benefits in terms of numbers provided to its members while others schemes has

about three or four benefits.

Under this study, a researcher aimed to pose a question in regard to gather the information, a

researcher generates questions purposefully to get information from the clients.

Based to the subordinates and NSSF members, the purpose those questions as per

questionnaire was to know exactly the kinds and types of services which normally NSSF

provide to its members. The respondents were asked to verify and justify on either are getting

financial services, non-financial services or both of them. Summary of the findings are shown

in table 4.4 below:

24

Table 4.4 Response towards the services provided by NSSF to its members

Respondents Frequency Percent

Financial service 25 50

Both financial & and non-

financial

16 32

Non-financial 9 18

Total 50 100

Source: field data, 2015

The above table 4.4 indicated that the response towards the services rendered by NSSF to

their members in order for a researcher to differentiate them from that provided by other

incentive schemes

Financial services

Majority of the respondents about 25 (50%) from the targeted group stated that financial

services as the major services rendered by the NSSF to its members. This implies that

whatever many services are provided by the NSSF (National Social Security Fund) to its

members, financial services is high considered.

Both financial and non-financial services

Under this study, specifically to this aspect respondents 16 (32% of the targeted respondents

declared that NSSF provide both financial and non-financial services to its members.

Something which implies that may be there is a chance of choice according to the will

between the parties or circumstances that influence the matter. For instance instead of getting

money because of workers stoppage of work such man can receive a plot of land a complete

building house of the same amount he/she would get.

Non-financial services

In this findings 9 (18%) of the respondents declared that the NSSF provided non-financial

services to its members. Through associate numbers of questions respondent were clarifying,

explain and commented that always NSSF help them to build houses to enables the members

to sustain their living life’s with their family, so that is non-financial services provided under

the scheme or not

25

A researcher found that the number of respondents who responded on that aspect was quit

small in terms of numbers which may implies that many of the members of NSSF consider

financial services rather than that of non-financial.

4.3.2 Other benefits members gain from NSSF

Researcher pose a question to his respondents in order to exhorts if there are any other

benefits NSSF members may enjoy/gain. The findings are shown in table in 4.5 below:

Table 4.5 Response towards other benefits under NSSF to its members

Respondents Frequency Percent

Yes 35 70

No 15 30

Total 50 100

Source: Field data, 2015

The above table 4.5 indicated that out of 50, 35 (70%) respondents agree that there are other

benefits they enjoy from the NSSF while 15 (30%) respondents argue that there are no other

any benefits gains from the NSSF. The findings implies that majority of the respondent which

cover about 70 percent argue that there are other benefits they enjoy from NSSF apart from

long term benefit/ Pension and short term benefits NSSF members are entitled with other

services like loan through SACCOS and NSSF participate in various social development.

4.3.3 Needs for expanding the benefits/ services

Respondents were asked whether they see any need for NSSF to expanding its benefits and

services in addressing the issues related to social security. Summary of the findings are

presented in table 4.6 below:

Table 4.6 Distribution of the respondents regards to the expansion of services

Respondents Frequency Percent

Yes 45 90

No 5 10

Total 50 100

26

Source: Research finding, 2015

Findings revealed that out of 50 respondents 45 (90%) were see the need of NSSF to expand

its benefits and services while 5 (10%) do not see any need of NSSF to expand its

services/benefits. This implies that majority of the respondents argued that NSSF should

expand their benefits/services. Also this findings indicates that NSSF should extends its

coverage to the category of worker which are left out like those engaged in informal sector/

economy, and self-employed so as to boost the welfares of workers in both category.

4.4 Members satisfaction/ Dissatisfaction

4.4.1 Satisfaction on the services rendered by NSSF

A researcher pose a question as it appears on the questionnaires respectively which need a

researcher to examine if NSSF members satisfying with the services provided, through this a

researcher design and generate question given to obtain the feedback from his respondents

In this research question which appears on the questionnaires paper, a researcher intended to

know if NSSF members are satisfying with the services they normally deliver from the

regarded social security scheme. Under this research objective, respondents were asked to

explain whether they satisfy with the services they normally gain. The findings are shown in

the table 4.7 below:

Table 4.7 Response towards the satisfaction on the services rendered by NSSF

Response Frequency Percent

Yes 40 80

No 10 20

Total 50 100

Source: field data, 2015

The above table 4.7 indicated that out of 50 respondents, many members of the NSSF are

satisfying with the services provided by their scheme, since that high percentage of about

(40) 80% of the total respondents agreed with the question asked and remarked that NSSF

always provided many services to them and the mostly were provided fund in terms of money

to support the vulnerable families, street children and orphans and their working life in

general.

27

Also NSSF contributed much to the social development based on the national policy since it

support different project established within the country, for instance supports on the sports,

habitat and dwelling establishment. Due to number of evidence from NSSF members and

official workers. This verifies that NSSF stakeholders are satisfying with the services

rendered to them.

Another group of respondents representing (10) 20% of the total did not agree with the point

of satisfaction based services based by the NSSF, since that time schedule is monopolized. So

it is very embarrassing by the time a required person demand to get his/her benefits. It takes

more than six months to be served or even sometime goes beyond that.

This findings show s that, the degree of satisfaction based on the services rendered by NSSF

to its members it’s highly appreciable to the majority of respondents.

4.4.2 Benefits presented at the right time

The study intended to find out whether if the NSSF members received their benefits at the

right time. The summary of the findings are shown in figure 4.1 below:

Figure 4.1 Distribution of respondent towards right time to acquire their benefits

25(50%)25(50%)ResponseYesNo

Source; Field data, 2015

28

The above findings revealed that out of 50 respondents 25 (50%) argue that their benefits are

presented at the right time while 25 (50%) do not agree with the question. This implies that

still there is a dilemma because its half/ half which means that sometime NSSF may present

the benefits to its member at the right time soon after 6 months but again after some time it

may implies to be complicated and goes beyond six months due to poor financial records of

an employee and the alike.

4.4.3 Research on improvement of services provided by NSSF

Information obtained from NSSF officials during interviews revealed that a number of

different research study has been conducted by the department of research in each year,

majority of the officials revealed that such investigation may then use in the establishing of a

new policies, also the research to determine their success, failure or threats in the social

security market competition from other provident fund. Also these researches help them to

improve their general services to its member so as to promote the welfares of the workers.

4.5 Problems which hinder the effective provision of services by the NSSF

4.5.1 Problems experienced

As per specific objective, a researcher intended to know what are the obstacles which hinder

the effective provision of the services, and a researcher gives the respondents rooms to

explain what’s is in their mind in regard to such objective. In verifying the validity of this

research objective, the issues and question were presented to the respondents, and part one of

the question were directed to the NSSF management, as well as its workers and the second

part were directed to the NSSF members. The findings are presented in figure 4.2 below:

29

Figure 4.2 Distribution of respondents towards problems which hinder NSSF

40(80%)

10(20%)

RESPONSEYesNo

Source: Field data, 2015

The above figure 4.2 revealed that the assessment made on the problems which hinder the

effective provision of NSSF services, the study revealed on the figure 4.2 above, most of the

respondents explain about the problems in collection of contribution from NSSF members.

Most of the respondents especially management and workers employed by NSSF

representing 50 of all targeted respondents in the study in general respondents 40 (80%)

argued that there is a lot of problems in effective provision of NSSF services due to the

numbers of associates problems in collection of contribution from members, and 10 (20%)

says that there is no problems which hinder an effective provision of NSSF to services to its

members. The study revealed that a very serious problems is experienced by NSSF arises

during collection of contribution of the retired workers from their employers who normally

fails to keep right and accurate records for their employee.

However since employers fails to display financial information concerning the deduction of

employees, in collecting the contribution also tends to be difficult.

4.5.2 Progressive effort to combat problems facing the Fund

The study intended to find out whether there is any serious effort made to combat such

problems which hinder the effective provision of NSSF services to its member. The findings

are shown in table 4.8 below:

30

Table 4.8 Distribution of respondents on effort to combat problems

Response Frequency Percent

Yes 30 60

No 20 40

Total 50 100

Source: Research findings, 2015

The above findings revealed that out of 50 respondents 30 (60%) which mark the high

response argued that there is serious progressive measures which have been taken by the

NSSF to combat problems facing the fund .While 20 (40%) which represent the lowest

percent did agree with the question. This implies that the high response from the respondents

which make a total of 60% agree with a question which means that NSSF is gradually work

on the problems facing their funds so as to offer the good quality of services to its members

and general to the development and promotions of workers welfares.

4.5.3 Withdrawal of members

Respondents were also interviewed on how far and to what extent does the withdrawal of

members affect the fund in general. Most of the NSSF officials including top senior

management and NSSF subordinates and few of the NSSF members were interviewed and

get in touch with the discussion in which most of them argued that withdrawal of members

affect their fund in annual planning project and investment, so when it comes a member is

terminated from the employment it may disturb the annual budget, also the findings revealed

that the employee could be affected on other hand and lost benefits from long term pension

like old age pension, invalidity pension/benefits and survivors pension. This implies that the

withdrawal of members is a serious problem to the funds and the welfares of workers in

general.

31

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATIONS

5.1 Introduction

This chapter is divided into three sections, the first section gives summaries of the report

content, and second section provides the author conclusive comments about the research

findings and the third one provide policy and recommendation for improvement and

promotion of workers welfares

5.2 Summary

In this research the researcher, has been dealing with the research study that involved the

welfares of workers which provided by NSSF. The researcher intended to analyze the

contributions of formal social security scheme in promoting workers welfares in Tanzania, A

case study of NSSF specifically at Kinondoni Region in Dar es salaam.

32

The study further aimed in assessing the welfares of the members of NSSF.

The research topic covered by three major areas which were NSSF management, its

subordinates workers and member from NSSF who receive benefits from NSSF.

Researcher was guided by three specific research objectives in this study as shown earlier in

chapter one

A research to be conducted successfully, proper method for collecting, analyzing data must

be applied. In this study researcher uses questionnaires as method for gathering primary data

and annual report, magazine and library document for collecting secondary data.

The first research objective based on the subordinates and customers, the purpose of this

research objective was actually to know the types of services which normally NSSF provides

to its members. The study showed that there are several types of services which provided by

NSSF to its members such as maternity benefits, employment injury, invalid benefits,

survival benefits, old age benefit and retirement.

The second research objective was to help to examine if NSSF members satisfying with the

services provided, in this research objective, a researcher generates numbers of questions in

the questionnaires and the respondents were asked to explain whether they satisfied with the

services which they are normally gain.

The last research objective was all about the problems which hinder the effective provisions

of NSSF services, in this research objective, the study revealed that most complaints is on the

collection of the members contributions from their employers, poor financial record keeping

of the employers, and members contribution are not presented at the right time because the

employers don’t prepare their benefit and check at arranged time hence disturb contribution

process.

5.3 Conclusion

The findings showed that the majority of respondents specifically members from NSSF as an

institution, were by most of the respondents agreed that NSSF provides better services which

made satisfaction to their members, for the maximum of maintaining their life during their

working period and their future life after retirement.

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However the study revealed that, the members from NSSF showed positive and negative

response that some of them satisfied with the services provided by NSSF and others not

satisfied due to the reason that were getting disturbance during follow up of their benefits.

The findings show that, there was a suggestion given by numbers of respondents on how

NSSF should improves their services to their members. The suggestion based on NSSF to

increase more employees and their services to be more updated to time change, and

modernization of facilities such as computer and having an effective data base. Also NSSF

should improve their fundamental policies of fund by reducing time of payment after

dismissal and retirement.

5.4 Recommendations

Recommendation given to the NSSF members, government and NSSF management to

promotes workers welfares in Tanzania.

5.4.1 Recommendation to the NSSF members

It is recommended that, members from NSSF should be in a position to create their

associations, operatives union to focus their will and interest, Also the members from NSSF

should initiate income project and seek assistance from government and other financial

institutions, Also members from NSSF should be in a position to influence their employers

and to make policies which provide special program for promotion and development

members.

5.4.2 Recommendation to the Government

Government should establish specific measures to alleviate poverty in general with specific

attention to their members, as government should be acting as a role model, Again

government should gradually implement effective employment policy which will protect

members from NSSF and helps them to get the sources of income out of their retirement

benefits, for instance offering their members some of the priorities in private sector like

farming, business and the alike.

5.4.3 Recommendation to the NSSF management

It is advised that NSSF management to continue in assisting in developing of alternative

services to its members and give facilities on credit to subordinate and other members, Also

NSSF management should increase the rate of benefit to their members, so as to meet the

34

level of living and wage per months, Again NSSF management should review their operating

policies of fund by giving more priorities of profit to their members.

REFERENCES

Ahuja.R. (2001), Research method, Rawat Publication New Delhi.

Citizens, 26 July, 2012, Reports on Social Security.

ILO (1984), Introduction to Social Security, ILO,Geneva.

ILO (1996), The cost of Social Security, Geneva.

Ishengoma.A.K, (1995) The capacity of Social Security System. Southern Africa.

Jacques, J.D (2007), Social Security, What can develop from Developed Countries,

Washington.

Johannes. J. (1999), Strengthen Social Security Systems of Rural Areas of Developing

Countries.

Kapuya.A.J. (2003), The National Social Security Policy, Tanzania.

Kaushik R.S (1999) “The Future Direction of Provident Funds, Sixteenth meeting of the

committee, Manila.

Kothari, C. (1992), Research Methodology, Skills and Techniques K. K. Gupta, New Delhi.

Kothari, C.R (1990), Research Methodology, 2nd Edition, New Delhi, India.

Mallya.W.J (1994), The role of NGO’s in providing social welfares and security for women,

Tanzania.

Michael.D.T (2004), Social Security and its Discontents perspectives on choice, Washington.

35

Mugenda. O. (1999), Research Methods, Qualitative and Quantitative Approach, Press

Nairobi, Kenya.

Maghimbi et al (2002), Social Security System in Tanzania, University of Dar es salaam.

NSSF (2013), NSSF Operations Guide, Issue No.4, 2013.

NSSF (2011/2012), Annual report of NSSF.

NSSF (2003/2004), Annual Report of NSSF.

NSSF (2001), “The extensions of Social Security Protection to the Informal Sector”.

NSSF (2001), Guide Together we build your Future, Issue No.4, 2001.

National Social Security Policy (NSSP), 2003, Government Print, Dar es Salaam

National Employment Policy (2008), Government Print, Dar es salaam, Tanzania.

Rwegoshora.H. (2006), Social Science Research.

Sylvester. J. (1999), The Real Deal, the History and Future of Social Security, Yale

University.

Social Security Regulatory Authority (2011/2012), Annual Report, SSRA.

The Guardian, 24th ,July 2012, Social security Dilemma.

36

APPENDIX “A”

Institute of Social Work

Questionnaire to be administered by Employers (NSSF Management) and

Surbordinates

I Gerald Josephat a student at the Institute of Social Work, Dar es Salaam. As a third year

I’m conducting a research based on the “CONTRIBUTIONS OF FORMAL SOCIAL

SECURITY SCHEME IN PROMOTING WORKERS WELFARE” A case study of

NSSF,DAR ES SALAAM

Kindly, would you please fill the empty space provided below through answering these

questionnaires. Also put a tick for a relevant answer.

All information will be kept strictly confidential and used only for the academic purpose

(research)

Section A: Personal Particulars

1. Sex (i) Male ( )

(ii) Female ( )

2. Age

a) 25-35 ( )

b) 36-45 ( )

37

c) 46-50 ( )

d) 51 and above ( )

3. Your position/Title…………………….

4. Education Qualifications

a) Secondary ( )

b) Certificate ( )

c) Diploma ( )

d) Degree ( )

e) Postgraduate degree/diploma ( )

f) Other (specify)…………………………………………

5. Duration of Employment………………………………………..

Section B: Services provided by NSSF

6.What are the benefits provided by NSSF?

………………………………………………………………………………………… (a)

Financial……………………

(b) Non-financial……………….

(c) Both financial and Financial………………….

7.What are the other benefits members may enjoy/ gain from NSSF?

Explain.........................................................................................................................................

......................................................................................................................................................

...........................................................................

8. As a manager/Personell do you see the need of expanding the benefits to the members?

(a) Yes ( )

(b) No ( )

38

If “Yes’’( Explain which benefits should be expanded/ added to the scheme)

…………………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

……

If “No” (Why)

Explain…………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

……………

Section C: Members satisfication/ Disastification

9. Are the members satisfied with the benefits offered by NSSF?

(a) No ( )

(b) Yes ( )

If “No”(Why).

Explain…………………………………………………………………………………………

…………………………………………………………………………………………………

……

10. Are the benefits provided to the NSSF members at the right time? If No/Yes. Give

reasons…………………………………………………………………………………………

…………………………………………………………………………………………………

…………

11.What are the frequently received complaints from the NSSF

members?.....................................

…………………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

39

Section D: Problems hindered the effective provision of NSSF benefits

12. What are the associated problems facing the effective provision of NSSF benefits to its

member?

(a) External factors……………………..............................................................................

…………………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

(b) Internal

factors…………………………………………………………...................................

…………………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

13. Is there any progressive effort made by the NSSF fund to overcome such problems?

(a) No ( )

(b) Yes ( )

If Yes/No,

Explain…………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

……………

14. How far does the withdrawal of members affect the Fund operations?

Explain…………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

…………………………………………………………………………………………………

40

“THANK YOU FOR COOPERATION”

APPENDIX “B”

Institute of Social Work

Questionnaire to be administered by NSSF Beneficiary (NSSF Members)

I Gerald Josephat, a student at the Institute of Social Work, Dar es Salaam. As a third year

I’m conducting a research based on the “CONTRIBUTIONS OF FORMAL SOCIAL

SECURITY SCHEME IN PROMOTING WORKERS WELFARE” A case study of

NSSF,DAR ES SALAAM

Kindly, would you please fill the empty space provided below through answering these

questionnaires. Also put a tick for a relevant answer.

All information will be kept strictly confidential and used only for the academic purpose

(research)

Section A: Personal Particulars

1. Sex (i) Male ( )

(ii) Female ( )

2. Age

e) 25-35 ( )

f) 36-45 ( )

g) 46-50 ( )

h) 51 and above ( )

3. Your position/Title…………………….

4. Education Qualifications

g) Secondary ( )

41

h) Certificate ( )

i) Diploma ( )

j) Degree ( )

k) Postgraduate degree/diploma ( )

l) Other (specify)…………………………………………

5. Duration of Employment………………………………………..

Section B: Services provided by NSSF

6. Do the services from NSSF given to you at the right time?

(a) Yes

(b) No

If “No” (Why).

Explain…………………………………………………………………………………………

…………………………………………………………………………………………………

……

7. What are the specific benefits/services you gain from NSSF?

(a)Financial benefits.(Explain/ mention them……………………….................................

(b) Non-financial,(Mention them………………………....................................................

8. Does the services provided by NSSF full of adequate or inadequate?

(a) Yes

(b) No

If“No”(Why).Give

reasons………………………………………………………………………

Section C: Members satisfication/ Disastification

9. Are you satisfied with the benefits/ services offered by NSSF?

(a) No

42

(b) Yes

If “No” (Why). Give reasons for

disastifications…………………………………………………………………………………

…………………………………………………………………………………………………

10. Are the benefits provided to you at the right time?

(a) Yes

(b) No

If “No” (Why)………………………………………………………………………………….

11. Does NSSF conducted any research in regard to the improvement of the services to the

NSSF members?

(a) No

(b) Yes

If “ Yes”( In what field)

…………………………………………………………………………………………………

…………………………………………………………………………………………………

Section D: Problems hindered the effective provision of NSSF benefits

12. Are there any problems hindered the sustainability of your organization?

(a) Yes

(b) No

If “Yes” (What are they).

Explain…………………………………………………………………………………………

…………………………………………………………………………………………………

13. Are there any strategic plan made to combat the problems faced your organization

(NSSF)?

(a) No

43

(b) Yes

If “Yes”( Explain them)

…………………………………………………………………………………………………

……………………………………………………………………………………………

14. Does the competition from other social security scheme affect NSSF?

(a) No

(b) Yes

If “Yes” ( To what extent). Give reasons……………………………………………...............

…………………………………………………………………………………………………

…………………………………………………………………………………………………

“THANK YOU FOR COOPERATION”

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