Table of Contents
TOC o “1-3” h z u CHAPTER 1 PAGEREF _Toc517419201 h 3Introduction PAGEREF _Toc517419202 h 3Background of the study PAGEREF _Toc517419203 h 3Statement of the problem PAGEREF _Toc517419204 h 5Research questions PAGEREF _Toc517419205 h 6Hypothesis PAGEREF _Toc517419206 h 6Purpose of the study PAGEREF _Toc517419207 h 6Significance of the study PAGEREF _Toc517419208 h 6Conceptual framework PAGEREF _Toc517419209 h 7
CHAPTER 1IntroductionThis research`s main aim is to focus on factors influencing non compliance on National Social Security Schemes. In this chapter the statement of the problem is discussed and also the chapter entails the purpose of the study, the significance of the study, conceptual framework, assumptions, limitations of the study, de-limitations of the study and so on.

Background of the studyThe National Social Security Authority (NSSA) is a parastatal which is responsible for administering a statutory responsibility fund in Zimbabwe in the form of Social Security Schemes. All employers and employees in formal employment are required to make monthly contributions towards the national pension scheme and workers compensation insurance fund scheme and this is in accordance with the national social security act chapter 17.04 of 1989, statutory instrument 393 of 1993 and statutory instrument 68 of 1990. The authority came into existence to establish Social security schemes for the provision of benefits to contributors of the schemes for the whole nation. NSSA administers Workers Compensation Insurance Fund which started its operations in 1989. The National Pension and Other benefits scheme which started its operations on 1994 that is on 1 October 1994. The NSSA governance framework is based on the existence of a proper legal and regulatory framework which govern its operations. NSSA`s mission is to provide social security and promote occupational safety and health for all members through responsive schemes and services.

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Though NSSA has other business operations, the main source of income for NSSA comes from the contributions of the employers and employees. Contributions received are invested to ensure continuity of the schemes. The Pension and Other Benefit Scheme (POBS) contributions are calculated at 7% half of the percentage coming from the employer and the ceiling is $700.00 in monthly salaries. The current payslip at the time of retirement is considered. The employer is then solely responsible for the funding of the workers compensation insurance fund which we call WCIF in abbreviations. These contributions are analyzed monthly based on a budget projected for each region in Zimbabwe by the compliance department, and then summarized cumulatively for the whole Organisation at Head Office in Harare
Normal retirement is at the age of 60 and late retirement at the age of 65 that is if the contributors feel that they are still eligible to perform some tasks. One can retire at the age of 55 if the person is on arduous employment for example those who work in farms. The contributors are entitled to a monthly pension if they contributed for 10 years and above towards the scheme, grant if they contributed for less than 10 years. Benefits such as children’s allowance, survivors pension, invalidity pension, and injury at work allowances are also provided for by the national social security authority.
NSSA has six main Regional Offices and eleven sub-offices. The main regions are Harare, Bulawayo, Gweru, Masvingo, Mutare and Chinhoyi.

Compliance rate
This is the rate at which registered employees make monthly contributions towards the scheme. Compliance rate is then measured by comparing the number of registered employers against the number of employers who are paying their contributions on a monthly basis. Legal compliance rate is then analysed as the employer’s capacity and keenness to conform to contributions laws which are determined by ethics, legal environment and other situational factors at a particular time and place. It is possible to determine compliance rate at any given time either per month or per year thus according to NSSA Employers guide of 2010.

Statement of the problemDespite the fact that it was the government of Zimbabwe that made it regulatory for all employers and employees that they make contributions to the scheme even those who are under some private pension scheme, the rate of compliance towards the scheme is now relatively low. The NSSA Act says that any person who does not comply with any provision of a scheme with which it is his duty to comply, shall be guilty of an offence and liable to a fine not exceeding level five or imprisonment for a period not exceeding six months or both thus NSSA Act Chapter17.04, section 3a and Contributions and Compliance Division annual report 2014. Therefore non compliance is violation of designated low. Compliance and contribution collection constitute core functions within social security systems. Wide population coverage cannot be achieved without appropriate and functioning contribution collection systems, which includes compliance and enforcement. However since 2015 the contributions and annual division report continuously reported that the rate of compliance was relatively low and therefore it is because of this report that made the write want to delve deeper in researching for the factors which are influencing non compliance.

Research questionsWhat is the rate of non compliance on Social Security Schemes.

What led to increase on non compliance and what are some of the reasons for non compliance.

To what extent has non compliance on contributions made towards the scheme affected the National Social Security Authority.

Are there any solutions and strategies that can be put in place to improve compliance on Social Security Schemes.

HypothesisH?= There is no significant relationship between difficulties in payment processes, workers personal reasons and
Purpose of the studyThe purpose of this study is to look for factors influencing non compliance rate with social security schemes so as to suggest ways that NSSA can adopt in order to improve compliance.

Significance of the studyThe research is a requirement of Solusi University needed by the student in completion of the BBA Accounting Degree. The research will also help the student in acquiring analytical skills which are important in decision making and also in solving problems both at school, workplace and in social life. Solusi University can also make the information available to other students who would want to do more researches and improve in their careers. NSSA will also benefit from the research as they will come to understand some of the causes of non compliance and come up with strategic plans which will reduce non compliance and result in the firm gaining more income through contributions that will be made towards the scheme. There are some employees who visit NSSA when they retire only to find out that the employer was not contributing towards NSSA and had not registered its employees and therefore these will be minimized.

Conceptual frameworkNon compliance on Social Security Security Schemes. Case of NSSA
Liquidity challenges in the economy
High contribution rates
Low penalties charged on avoidance
Low benefits paid to pensioners
High probability of not being detected
Difficulties in payment processes
Myopic behavior: ethics and attitude
Workers` personal reasons