Key changes to Tanzania’s Benefits Regulations

In this legal update, we analyse and highlight key changes made by the Social Security Schemes (Benefits) (Amendment) Regulations Government Notice No. 140 of 2024 (the Benefits Amendment Regulations 2024).

The Benefits Amendment Regulations 2024 amend the Social Security Schemes (Benefits) Regulations Government Notice No. 467 of 2018 (the Benefits Regulations 2018). The Benefits Amendment Regulations 2024 are made under section 25A of the Social Security Act [Cap 135 R.E. 2018] and apply to all schemes operating in Tanzania in relation to the benefits under these schemes.

The following key terms are defined under the Benefits Amendment Regulations 2024:

“Fund” refers to the Public Service Social Security Fund established under the Public Service Social Security Fund Act No. 2 of 2018 and the National Social Security Fund established under the National Social Security Fund Act [Cap 50 R.E. 2015];

“member” refers to an employee or worker registered by a scheme and includes a person entitled to or receiving a benefit under a scheme; and

“un-skilled member” refers to a member whose work does not require a specific set of skills including those whose level of education is between standard seven and advanced certificate of secondary education without further professional qualifications.

Deferred Pension

According to regulation 12 of the Benefits Regulations 2018, a member who has contributed to the Fund for at least 180 months but has not yet reached retirement age must, upon termination of service upon termination of service due to appointment to a political post, retrenchment, office restructuring, or abolition of public office, be granted a commuted pension, with the monthly pension deferred until they reach the age of 55.

The Benefits Amendment Regulations 2024 amends regulation 12 by outlining specific instances when pensions may be deferred:

• Where a member whose pension was deferred secured a new employment of which he continued contributing to the Fund, his retirement benefit shall, until he attains retirement age, be recalculated considering additional credits made less the amount previously paid as a commuted pension.
• If a member whose pension was deferred secured new employment and continues contributing to the Fund, but this new employment ends before they attain retirement age, the contributions made to the Fund after the pension was deferred shall be paid as special lumpsum if claimed before reaching retirement age. Otherwise, these added contributions will be recalculated by considering additional credits made, less the amount previously paid, upon reaching retirement age.
• If a member whose pension was deferred dies before reaching retirement age, their dependants shall be entitled to receive a survivor’s monthly pension from the date of death in accordance with relevant scheme laws.
• If a member whose pension was deferred before reaching retirement age, the member shall, upon determination of the medical board, be entitled to receive an invalidity pension from the date of becoming invalid.

Additionally, a member who has contributed to more than one Fund shall have his contribution period totalised during the processing of deferred pension.

Duration of Unemployment Benefits

Under regulation 20 of the Benefits Regulations, unemployment benefits will be payable on a monthly basis at the rate equivalent to 33.3% of the salary earned at the time of ceasing to be employed. Regulation 21(1) of the Benefits Regulations 2018 states that unemployment benefits will only be payable for a maximum of six months within twelve months. The unemployment benefit shall not be paid for a period exceeding an aggregate of 18 months for the entire employment circle or career.

The Benefits Amendment Regulations 2024 amend regulation 21 by adding a provision that entitles a member who has previously received an unemployment benefit of 33.3% and subsequently secures new employment to receive another unemployment benefit upon cessation of the new employment, provided they have contributed for not less than 18 months.

Payment of Special Lumpsum

The Benefits Amendment Regulations 2024 adds regulation 21A to the Benefits Regulations 2018 by introducing special lump-sum payments for the following members: 

• Unskilled member who ceases to be employed for any reason other than resignation and his contribution period is below 180 months.
• A member who joins a scheme after the age of 45 and, upon cessation of his employment for any reason other than resignation, will not qualify for an old age pension even if they continue contributing up to the pensionable age.
• A member who is above 45 years of age who, upon cessation of employment for any reason other than resignation, has contributions below 180 months and will not qualify for old age pension even if they continue contributing up to the pensionable age.
• A foreigner employed in mainland Tanzania who leaves the country upon cessation of employment.
• A member who, upon cessation of employment, emigrates from and has no intention of returning to the United Republic of Tanzania and the country to which he emigrates has no bilateral agreement with the United Republic of Tanzania that allows portability of benefits.
• A member who has ceased to be employed for any reason other than resignation and his contribution period is below 180 months.
• Subject to conditions outlined in the Fund’s operational manual, a member who is terminally ill, does not qualify for any long-term benefit or is pursuing further studies, with a contribution period below 180 months.
• A member who qualifies for unemployment benefits and whose calculated 33.3% monthly instalment for six months exceeds his total accumulated contributions.
• Subject to conditions outlined in the Fund’s operational manual, a member who ceases to be employed for any reason other than resignation and is pursuing further studies in a recognised college or higher learning institution, with a contribution period below 180 months.

Conclusion

The Benefits Amendment Regulations 2024 represent a significant advancement for Fund members. With enhanced clarity on deferred pensions, recalculations for new contributions, and extended unemployment benefits, the regulations provide a more flexible and supportive system. Additionally, the introduction of specific lump-sum payments for unskilled members and those facing unique circumstances highlights a compassionate approach to member welfare. These changes empower members to navigate their financial futures with confidence, fostering a more inclusive and responsive system that prioritizes their well-being.

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