What are the rates of contributions and how are they remitted
From 2001, PPF has two rates of contributions. These are 10% for the employee and 10% for the employer as one category and the other category is 5% for the employee and 15% for the employer. Any of the two categories is acceptable for traditional pension scheme.
Remittance of contributions is done by the employer on monthly basis. Any delay or non remittance of contributions is an offence and attracts a penalty.
PPF has another scheme known as Deposit Administration scheme. This scheme was designed for two major reasons. First, it is a scheme for those who do not meet conditions for the traditional pension scheme. Second, it is a supplementary scheme for any employee who is a member of any social security scheme. Contributions rates are flexible under supplementary scheme. They might be a percentage of salary by both employee and employer or employer only or fixed amount.
What happens if members' contributions are not remitted?
According to the PPF Pensions Fund Act [CAP 372 R.E. 2002] as amended, the Act empowers the Fund to institute legal action against defaulting employers who fail to remit contributions for their employees.
Whose responsibility when contributions are not remitted, why PPF should wait until an employee leaves employment?
The responsibility of remittance is with the employer as per section 8 (3) and the Fund does not wait until an employee leaves before making follow up on un remitted contributions. However, a lot of issues maybe involved with non remittance and sometimes it is difficult to tell if it is a deliberate move by employer. Therefore, in order to settle this problem the Fund has improved its IT system so as to be able to issue statements to members directly and members are also able to view their contributions through internet (www.ppftz.org) or mobile phone.
Why does PPF penalize members due to late remittance and under which section?
It is the employer who is penalized for none or late remittance as per Section 9(1).
How can a member get information about his/her contribution status?
A member can get information about his/ her contribution status by retrieving his statement through our website which is www.ppftz.org or mobile phone The Fund also issues statements to members directly at least once a year and anytime on request.
Can a member borrow part of his/her contributions while still on employment to finance his/her development projects?
At the moment it is not possible for a member to borrow his/ her contributions while still in employment as this will be defeating the whole purpose of pension. However, the Fund has come up with other set ups like lending money to SACCOS where the members can also borrow. The Fund is also waiting for the regulations from SSRA on the subject of collateral for home mortgage as per Section 38 of the Social Security (Regulatory Authority) Act, 2008.
What benefits does PPF offer to its members? How do PPF determine the type of benefits to be granted to a member upon ceasing employment?
PPF offers seven different types of benefits to its members under the Traditional Scheme. Benefits offered are as follows:
- Old age benefit
- Sickness/Disability benefit
- Death benefit
- Survivor’s Benefit
- Education Benefit
- Gratuity benefit
- Maternity Benefit
Each type of benefit is granted to a member upon such a member ceasing employment and other qualifying conditions related to each benefit.
How do PPF benefits align with ILO Minimum benefits Standards?
The ILO minimum benefits standards (convention No. 102 of 1952) provide nine minimum contingencies to be covered under social security schemes. These contingencies include old age, sickness, disability, death, maternity, unemployment, employment injury, Health care and subsidies for families with children. PPF provides benefits to its members in line with the ILO Conventions. It is provided that the basic contingencies must be covered by any social security scheme. These contingencies include old age, sickness, disability and death, which are covered by PPF.