Pension Schemes

Social security is aimed at enabling people to live a respectable life where they can meet their basic needs even in the event of social and economic disasters that lead to reduction or cessation of income. Such disasters could be death or disability. Social protection also addresses reduced income that may result from old age, maternity or sickness.

It is therefore, social security a right to everyone. This right is contained in the constitution of the United Republic of Tanzania article 11(1) and the National Social Security Policy of 2003. This right is also classified in the Universal Declaration Human Rights of 1948 and International Labor Organization (ILO) charters.

Social Security System

In Tanzania, the Social Security system is divided into (3) three tiers/pillars;

Tier One – Social Assistance Schemes 

This constitutes provision of services such as primary health; primary education, water, food security and other services on a means tested basis. These services are usually financed by the government and Non-Governmental Organizations (NGOs).

Tier Two – Mandatory Schemes 

These are usually compulsory and contributory schemes financed by both employer and employee during the working life for terminal and short-term benefits.

Tier Three – Voluntary or Supplementary Schemes    

The schemes under this tier include personal savings, co-operative and credit societies, occupational pensions schemes and private schemes; managed by employers, professional bodies, community based organizations and other private sector actors


Pension fund is a common asset pool meant to generate stable growth over the long term, and provide pensions for employees when they reach the end of their working years and commence retirement. In the mainland Tanzania, there are two mandatory Social Security Schemes that are all regulated by SSRA. They include;

  • National Social Security Fund (NSSF)
  • Public Service Social Security Fund (PSSSF)

Importance of Social Security (Pension Funds):

  • Extends Social Security coverage
  • Reduces poverty among Tanzanians
  • Increases protection for Tanzanians in aspects such as education, health, maternity, disability and old age.
  • Boosts economy through investments and opportunities for entrepreneurs through various social groups
  • Contributes to the development of various projects of the Government
  • Increases employment to Tanzanians through projects facilitated by Pension Funds

Benefits offered by Social Security Schemes:

There are two kinds of benefits offered by the pension Schemes. These are short term benefits and long term benefits:

  • Long term benefits
  1. Old age (Pension) 
  2. Invalidity 
  3. Survivors’ 
  • Short term benefits
  1. Medical care 
  2. Employment injury
  3. Maternity
  4. Death/Funeral benefit
  5. Education

Involvement of  Informal sector in Social Security Sector:

Tanzania, like many other countries in the developing world has had strong informal and traditional social security systems built on family and/or community support.

Informal sector has been involved in social security system through joining Supplementary schemes offered by social security schemes.

Tovuti Muhimu