TSC: How To Check Your Provident Fund Contribution Using USSD code
Teachers and government employees are now required to pay into the provident fund in order to receive their pension.
Teachers are being urged by the Teachers Service Commission (TSC) to call USSD Code *378#, verify their account, and set a password.
Teachers will subsequently be able to verify their contributions and fund balances, as well as the beneficiaries and any updates.
The Public Service Superannuation Scheme (PSSS) is a defined contribution pension plan where both the employer and the employee make financial contributions.
This came after the Public Service Superannuation Scheme (PSSS) Act, which was passed in 2012 but didn’t go into effect until the first of January 2021. The Retirement Benefits Authority (RBA) oversees the Scheme’s operations.
The government ran a Non-contributory program (Free Pension) before to the Defined Contributory program, which was entirely funded by the exchequer since independence.
Non-contributory scheme Disadvantages
1. The plan disadvantages workers who may choose to leave their jobs before they turn 50 because they are not eligible for a pension or any other benefits.
Benefits from the plan cannot be transferred to another pension plan if a member is offered employment by a company that offers a pension plan.
3. No extra voluntary contributions to the Scheme may be made by a member.
4. Until the time of exit, the accrued pension cannot be obtained.
5. The marriage gratuity and widowers pension are discriminatory towards male officers.
Benefits of a Defined Contribution Plan
1. Tax advantages, such as pretax contributions that lower an employee’s taxable income. Prior to calculating taxes, the pension contribution is subtracted from the base salary. Members are eligible for a tax advantage up to the lesser of Ksh 20,000 or 30% of pensionable earnings.
2. A retiring officer who resigns or is fired does not forfeit their pension.
3. Upon leaving, the accrued pension may be transferred to a different pension plan of one’s choosing.
4. In addition to the statutory 7.5% of the basic income that employees must contribute to the plan, they may choose to make additional optional payments. The government will not increase its contribution in cases when an employee chooses this choice.
5. Members of the plan may receive retirement benefits before the stipulated retirement age due to termination, resignation, illness, mortgage financing, an advance to purchase a primary residence, immigration, or death.
6. Under the retirement benefits (mortgage loans) (amendment) regulations of 2020, pension scheme members have the right to access up to 40% of their accumulated contributions, up to a maximum of Ksh 7 million, for the purchase of a primary residence.
Participation in the Defined Contribution Scheme
1. Employees on permanent and pensionable terms of service who are younger than 45 as of January 1, 2021
2. New hires who begin working for the government on or after January 1, 2021
Employees might choose to join or not to join if they were 45 years of age or older as of January 1, 2021. Employees over the age of 45 who chose not to enroll in the plan continued to receive benefits under the public service pension plan, which was the previous non-contributory pension plan.
Contributions to the newly implemented Defined Contribution Plan
The basic salary contribution rate is graduated in the following ways: 2% in the first year beginning January 1, 2021; 5% in the second year beginning January 1, 2022; and 7.5% in the third year beginning January 1, 2023.
15% of an employee’s base salary is contributed by the employer. Because PSSS is a defined contribution plan, employer and employee contributions are invested to generate income from investments.
The board of trustees oversees the finances. Since the creation of this agreement, the male employees have stopped making contributions to the NSSF and the Widows and Children’s Pension Scheme (WCPS).
TSC: How To Check Your Provident Fund Contribution Using USSD code
