Linked projects

• - Nepal - Institutional capacity, legal and policy frameworks are strengthened for the improvement and extension of social protection coverage (country programme 2016-17)
• NEP/15/51/JPN - Actuarial Studies for the Establishment of Social Security Schemes (ASSESS) : ILO Technical Assistance to the Social Security Fund in Nepal

Outcome summary

Outcome achieved

In September 2017, the Ministry of Labour and Employment endorsed the actuarial valuation of five prioritized new Social Protection Schemes to be implemented under the Contribution-based Social Security Act, developed for the Social Security Fund (SSF).The Ministry also conducted an actuarial valuation of the contribution-based pension scheme for formal private sector workers proposed by the Employees’ Provident Fund (EPF). The five schemes of the SSF are: sickness benefit, maternity protection, workplace injury, unemployment insurance and medical care. According to the SSF regulations, one per cent income tax is currently levied on total taxable earnings (basic salary plus allowances) of employees of the formal economy. Based on the valuation, only maternity and sickness benefits have been found feasible with the additional one per cent contribution coming from the workers.

ILO's contribution to the outcome

The ILO, with financial support from Japan [NEP/15/51/JPN], organized experts’ missions and interactions with constituents to raise awareness and strengthen their commitment to conducting actuarial valuations before deciding on the selection of a scheme for implementation. The ILO conducted the actuarial valuations and prepared reports for the five prioritized schemes. The ILO also developed the actuarial valuation of a proposed contributory pension scheme for private sector workers for the EPF. All actuarial valuations included tripartite consultations.