April 15th, 2017
Purpose: Compulsory national saving system
General Description: Our National Provident Fund (NPF) ensures members savings are matched by their employers at the rate of 1:2 and paid out to on retirement or should they be made redundant after interest is applied.
Type of scheme: It is a defined contribution scheme in which both employers and employees alike make fixed contributions into individual member’s account. Benefits paid out are based on the contributions paid into the member’s account plus interest accrued from the time of the first contribution up to a member attaining the normal retirement age of 60 years.
Who is eligible to be covered? Full time employees of any nationality working with a registerable organisation who are aged between 18 to 59 years can register with the NPF. In addition, any employer and employee to whom, the state Pension Board Act applied before the coming into force of SSHFC Act 2015 are eligible. Also, employees of Diplomatic Missions or International Institutions based in the Gambia who are Gambian citizens can participate in this scheme.
Who are registerable organisations for the NPF? Registerable organisations under the NPF are private sector organisations who are registered under the 1973 Business registration ACT.
Who is Disqualified? The following categories of persons are disqualified from participating in this scheme:
Who pays the contribution and how much? Under the NPF, the contribution rate is 15% of the employees’ Basic Salary (i.e. salary without other fixed allowances), because employers matches the contributions paid by employees at a ratio of 2:1. Each month the employees’ contribution of 5% is deducted from their wages and the remaining 10% is paid by the employer on behalf of the employee.
What benefits are paid out and how? For most members their concern is when and how to access their contributions. It is important to note that the savings in the National Provident Fund are for retirement purposes above other considerations. However apart from the normal retirement, there are contingencies that allow members to get paid a part of their savings in the event of a premature termination of service due to ill health, redundancy or on the grounds of marriage for female members of the scheme or a member chooses early retirement.
Who is responsible for the Administration of the NPF? SSHFC is the sole administrator of the Federated Pension Scheme.
Earlier Acts of Parliament – SSHFC ACT 1981, SSHFC ACT 2010
Current Act of Parliament – SSHFC ACT 2015
To qualify for the National Provident Fund members must be:
A visit will be conducted by a SSHFC Compliance Inspector to eligible or registrable organisations to explain the benefits and workings of the FPS.
The employees of member institutions are required to complete the SSHFC registration form, NPF2 FORM (Click here for the form). The completed form must be endorsed by the employer.
Your full name, date of birth, date of employment, job title, current gross and annual salary, marital status, gender and previous employers MUST be stated clearly in the registration form. In addition, the following key documentation must also be submitted with the completed form:
Member institutions as employer shall remit to the social security fund, all contributions due for all their employees registered in this scheme, not later that the 15th day of the month following that in which the relevant salary or wages were paid.
The monthly contributions are calculated at 15% of the employees’ basic salary (i.e. excluding fixed allowances). Each month the employees’ contribution of 5% is deducted from their wages and the remaining 10% is paid by the employer on behalf of the employee.
The remittance schedule (NPF3 FORM) must accompany all contribution payments and employers must quote this when they pay contributions for their employees. The remittance schedule must be accurately completed giving names, salary, Social Security numbers and the amount payable for each employee.
Members accounts will be updated as contributions are paid in by employers using the information on the NPF3 FORM.
A penalty charge of 2.5 % (per cent) of the unpaid amount will be levied on the employer for the late payment of contributions for each month or part of the month such amounts remain unpaid.
The following events trigger the pay out of pension benefits:
N.B. To be eligible in any of the above events except in the case of death a person must:
A cooling off period must be observed and the length is determined by the age of the member at the time of retiring. For those withdrawing from the scheme between the ages of 45 - 54 years, a 6-months cooling off period must be observed. For those aged 55 years and above, a 3-months cooling off period is required. The cooling off period begins from the date of submission of claim. The resumption of employment before the expiry of the cooling off period shall terminate entitlement to benefit.
Applying through their employers retirement benefit benefit payment will made to scheme members as follows:
At the request of the claimant however, part of the lump sum may be converted into an annuity, receivable periodically similar to a monthly pension.
AGE PERCENTAGE OF ACCURUALS PAYABLE
The balance in the member’s account shall be payable on normal retirement or when entitlement is established under the other contingencies, subject to qualifying conditions relating to those contingencies.
This benefit is not payable to a member who leaves one employer for another. Members who prematurely retire can re-join the scheme if they are not more than 59 years of age.
AGE PERCENTAGE OF ACCURUALS PAYABLE
Accounts are closed following full settlement of benefit. However they will be maintained as dormant for reference purposes until expiry of member record retention period expires as per policy.