Labour Minister Stresses Importance of Social Security Scheme for the Informal Sector

Minister of Employment, Labour and Social Security, Mohamed Rahman Swaray, has on September 14, 2023 officially inaugurated the first meeting of the Steering Committee for the Informal Sector NASSIT Scheme.

During the opening, he stressed the need for a radical shift towards comprehensive social protection particularly for workers in the informal economy.

The Minister highlighted the importance of the proposed Social Security Scheme for workers in the informal sector, which includes the establishment of a Technical Committee responsible for providing technical guidance in designing the scheme.

These Committees have been tasked with creating a viable system that safeguards against critical socio-economic contingencies for the vast majority of individuals who are not effectively covered by the existing NASSIT Act.

Expanding social protection systems presents challenges, primarily due to heightened labor market uncertainties and fiscal constraints faced by Governments, as well as extreme poverty and exclusion levels in society. The Minister emphasized that social protection is a pivotal element of the Government’s strategy for human capital development, political stability and inclusive growth.

From a social protection perspective, the Ministry aims to transition from ad-hoc emergency interventions to create a more coherent, comprehensive and sustainable social protection system. This approach encompasses social assistance, social insurance, and potentially universal minimum pensions for the elderly.

Minister Swaray noted that despite various efforts by successive NASSIT administrations over the past 20 years, the informal sector and self-employed individuals, constituting approximately 92 percent of the workforce, remain outside the NASSIT scheme and lack coverage under any organized social security system.

To address that, he stressed the importance of a well-thought-out design for an informal sector scheme, particularly one that involves voluntary contributions from workers. The Minister highlighted the necessity of creating a scheme that makes sense for voluntary participation, as imposing mandatory compliance would be impractical.

Regarding administrative costs, Minister Swaray underscored the need to keep them in check, as the proposed scheme would be based on voluntary savings and carry significant benefit liabilities. He suggested that the scheme’s design should establish safeguards to control administrative costs, regardless of who manages it.

Furthermore, the Minister explored the potential benefits of private sector involvement in the management and administration of the proposed informal sector scheme. He cited examples from other countries, such as Tanzania, Ghana, Kenya, Rwanda, and Cape Verde, where private sector partnerships have enhanced operational effectiveness, service quality, cost efficiency, and coverage.

Deputy Director General of NASSIT, Mohamed Gbondo, explained the processes and procedures leading up to the meeting. He expressed satisfaction with the cooperation received from most members of the informal sector during the engagement process, anticipating that the outcome would be widely accepted and easily implemented for maximum success. While acknowledging potential challenges ahead, he expressed confidence in the Committee’s ability to overcome them.

The meeting, held at the Freetown International Conference Center, Bintumani Hotel in Aberdeen, Freetown, drew substantial attendance from informal sector representatives, NASSIT staff, the Press, and other distinguished figures, demonstrating the importance of establishing a scheme for the Informal Sector.

Several Government officials, including the Minister of Social Welfare, Attorney General and Minister of Justice, Deputy Minister of Youth Affairs, Minister of Trade and Industry, and Deputy Finance Minister I, were also present in a show of solidarity for the critical initiative.


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