Gen Katumba Wamala, the Public Service MinisterCivil servants will begin contributing to their retirement benefits, marking the end of Uganda’s decades-old non-contributory pension system.The Ministry of Public Service on Wednesday announced the implementation roadmap for the new Public Service Pension Fund.The new arrangement will require public officers to contribute five percent of their monthly salary, while the government will contribute an additional 10 percent.Public servants have in the past been covered by an unfunded, non-contributory pension scheme under the Pensions Act, Cap 89.The government has been paying lump-sum gratuities and monthly pensions directly from the national treasury.Parliament enacted the Public Service Pension Fund (PSPF) Act, 2025, marking the end of an era and the beginning of a modern, contributory retirement system.This transformed the non-funded, non-contributory system into a funded, contributory scheme.The Act establishes the Public Service Pension Fund (PSPF) and outlines a mandatory pension scheme for eligible public servants.That arrangement guaranteed income for retirees, but the government noted that it did not accumulate assets, creating large unfunded liabilities that led to payment delays and arrears.Gen Katumba Wamala, the Public Service Minister, said the new fund will start next year with a one-year transition period, which is intended to allow institutions to prepare for the rollout before contributions commence on July 1, 2027.“This is one of the main reforms in the Public Service sector, and it is for the good of the civil servants. It will be rolled out next year,” said Katumba Wamala.According to figures by the Uganda Retirement Benefits Authority, Uganda had 334,146 civil servants and 64,855 pensioners.Information from Parliament’s website indicated that in the 2021/2022 financial year, the total annual pensionable emoluments amounted to 2.8trillion shillings while annual pension payments totalled 3.1trillion shillings.Gen Katumba said the board overseeing the Public Service Pension Fund is already in place and is working to establish the necessary systems and structures for managing the scheme.He added that one of the key benefits of the reform is that retirement benefits will be processed more efficiently, enabling pension payments to be ready as soon as an officer retires.The contributory scheme, established under the Public Service Pension Fund Act, is expected to transform retirement financing for the public service by creating a dedicated pension fund similar to the National Social Security Fund (NSSF), which serves private sector workers.The minister explained that the scheme will cover public officers appointed on permanent and pensionable terms, including employees in ministries, local governments, the teaching service, health service, the Uganda Police Force and the Uganda Prisons Service.For decades, public servants have retired without making pension contributions during their years of service.Instead, the government has financed gratuity and pension payments directly from the Consolidated Fund, a system that has created growing long-term liabilities as the public service expands.The new pension scheme forms part of broader public service reforms aimed at modernising human resource management and reducing the government’s long-term pension obligations while providing a sustainable and professionally managed retirement savings system for civil servants.Catherine Bitarakwate Musingwiire, Permanent Secretary at the Ministry of Public Service, urged public officers not to be concerned about the new arrangement, explaining that their contributions would be transferred directly from the Ministry of Finance to the Public Service Pension Fund.Bitarakwate added that, like other contributory retirement schemes, the fund would invest members’ savings, enabling civil servants to earn returns on their accumulated contributions over time.In a statement, the Ministry of Public Service assured public officers that the transition to the new pension scheme would be managed gradually, with guidance provided to both serving officers and those approaching retirement.The ministry clarified that civil servants who retired under the existing pension system would continue receiving their gratuity and monthly pension from the Consolidated Fund and would not be affected by the reforms.For officers already in service who will migrate to the contributory scheme, the government said pension benefits earned under the old arrangement would be safeguarded through a Government Retirement Bond, which will be redeemed upon retirement.As part of the transition, Permanent Secretary Catherine Bitarakwate Musingwiire directed all responsible officers to update employee records on the Human Capital Management System, including National Identification Numbers, dates of birth and dates of first appointment.The information will be used to determine accrued pension liabilities, register members and facilitate a smooth migration to the Public Service Pension Fund.The ministry also instructed accounting officers to budget for both the government’s 10 percent employer contribution and the employees’ five percent contribution in the 2027/2028 financial year.The Ministry of Public Services ordered government agencies, boards and commissions to align their human resource policies with national public service standards, saying no new human resource policy should be implemented without clearance from the Public Service Commission, the Ministry of Public Service, the Ministry of Justice and Constitutional Affairs, and final approval by Cabinet.“No new policy shall be implemented prior to review by the Public Service Commission, technical clearance by the Ministry of Public Service, legal clearance by the Ministry of Justice and Constitutional Affairs, and final approval by Cabinet,” the statement from the ministry reads in part.The statement further notes that existing human resource manuals must be submitted to the Ministry of Public Service for verification and harmonisation within 30 days from July 1, 2026.-URNThe post Civil Servants To Co-Fund Retirement Benefits Under New Pension Scheme appeared first on Business Focus.