SSC mulls unemployment insurance in plans to extend social protection to informal sector

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WINDHOEK – The Social Security Commission (SSC) yesterday announced its intention to extend social protection to the informal economy and has embarked on feasibility studies to investigate the viability of introducing an Unemployment Insurance Scheme and a Return to work (rtw)programme.

“It is common knowledge that the majority of informal economy operators and their employees all over the world are not adequately covered by social protection schemes. The situation in Namibia is also the same, whereby only a few operators have access to social protection,” said SSC’s Executive Officer, Kenandei Tjivikua, yesterday during a media briefing. He added that the SSC realised the need of extending social protection to workers in the informal economy as early as 2011 when research work on the introduction of the National Pension Fund (NPF) commenced in earnest. “At the time, it was realised that the NPF would cater for those in formal employment only, excluding workers in the informal economy,” said Tjivikua.

The SSC has now decided to commence with a study to understand the nature of the informal economy as well as its social protection needs. The last study of this nature was conducted way back in 2001 and is now outdated. According to Tjivikua, it was agreed that the Ministry of Labour and Social Welfare will be the lead agent in the process, with the co-operation of the SSC and the Namibia Statistics Agency. “The SSC remains committed to extend social protection to the informal economy, per its mandate,” added Tjivikua.

The SSC is now also investigating the feasibility of an Unemployment Insurance Scheme, which would provide financial cover to members that become involuntarily unemployed. “The cost of these benefits is usually met by requiring members and their employers to make regular contributions to a fund, called the Unemployment Insurance Fund,” noted Tjivikua. Namibia does not currently have any unemployment insurance arrangement and the SSC’s investigation will explore its feasibility and the steps needed to implement it.

In addition, the SSC has contracted a team of consultants to conduct a feasibility study on a Return to Work Programme. The study is expected to be concluded towards the end of August this year and would include financial support for employees who through illness or accident are unable to continue to work. This type of assistance is most commonly paid in the form of an income in order to provide a bridge to assist the ill or injured employee over the obstacles of returning to work, assuming that re-employment is possible.

While the SSC already provides a financial benefit to workers covered by the Employees Compensation Act, it has increasingly been acknowledged that income replacement alone is an inadequate response. “Rehabilitating the injured or ill employee in order to enable them to return to work as soon as possible is an alternative approach that is now gathering global traction and lies at the heart of the RTW programme,” remarked the SSC’s Executive Officer. He continued that “a soundly run RTW programme has proven to be good for affected employees who benefit from much accelerated recuperation resulting in productive employment and general well-being.”

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