22 Oct 2024
SSC Plans Contribution Increase to Sustain Maternity, Funeral, and Social Protection Benefits Amid Rising Costs
Namibia's Social Security Commission (SSC) is planning to increase member contributions in 2025 to ensure the long-term sustainability of its social security benefits, the commission's Chief Executive Officer, Milka Mungunda, announced.
The precise rate of the contribution increase will be determined after the completion of an actuarial report, which is expected by the end of October, Mungunda said.
Currently, SSC members contribute a minimum of N$2.70 and a maximum of N$81 per month, while self-employed individuals contribute 1.8% of their basic income.
“We’ve seen strong performance from our robust investment strategy, and this has allowed us to improve benefits like maternity leave without increasing contributions. Unfortunately, this is no longer sustainable, and we will need to raise contributions next year to continue enhancing benefits for our members,” Mungunda said.
Despite the need for an increase, Mungunda assured that the financial impact on members will be minimal. “In terms of the percentage and the amount of the increase, we are awaiting the actuarial report. However, I can guarantee that it will not be significant,” she said.
One key area that the increased contributions will support is improved maternity benefits. Currently, women earning over N$15,000 receive a maximum benefit of N$15,000 during maternity leave, even if their actual salary is higher. The SSC aims to gradually increase this cap, moving toward paying 100% of a woman’s salary during maternity leave.
“Our goal is to move incrementally toward full salary payments during maternity leave, so mothers earning higher salaries receive a more substantial portion of their income,” Mungunda explained.
There is also consideration of extending maternity leave from the current three months to six months, in line with recommendations from the International Labour Organisation (ILO).
“There are discussions about extending maternity leave, but we must carefully weigh the financial and economic implications before making a decision,” Mungunda said.
The SSC is also reviewing its funeral benefits. Currently, the funeral benefit scheme offers N$4,500, a sum that Mungunda acknowledged may no longer be sufficient to cover rising funeral costs.
“We are looking at ways to revise and increase the funeral benefit to meet current demands. Funerals have become quite expensive, and we want to ensure that all Namibians have access to a dignified send-off for their loved ones,” she said.
Mungunda emphasized that the SSC’s mandate is to provide essential social protection for Namibians, including maternity and funeral benefits, while ensuring the commission's financial sustainability.
“We are committed to improving social protection for all members, but this requires careful planning and, unfortunately, increased contributions from next year,” she said. “I want to assure our members that these increases are being introduced to ensure we can continue delivering the highest possible benefits to them.”
Over the past year, the Maternity, Sick & Death Fund disbursed N$9.3 million for death claims, N$53.9 million for disability and retirement, N$205 million for maternity, and N$23.9 million for sick leave claims. The Employee Compensation Fund paid N$8.6 million in pensions, N$3.4 million for medical expenses, and N$15.2 million for temporary disability claims. The Development Fund disbursed N$1.2 million in bursary payments and N$123,700 in loans. The Funeral Benefit Scheme recorded N$37.7 million in payments for 8,000 claims through 107 registered undertakers.