Capital gains strengthen National Social Security Fund profits

NSSF managing director, David Chadi Jamwa yesterday told journalists in Kampala that the impressive performance has been a result of a number of strategic investment decisions as per the fund's five-year corporate strategic plan. Some of the said decisions included aggressive equities reallocation, trading in shares, re-allocation of investments from treasury bonds, bills to commercial paper and prudent foreign exchange risk management.

“The fund made a total of UGX51bn in capital gains for the year under review. These included UGX11bn from Safaricom IPO (East Africa's largest equity deal), UGX18bn from Stanbic Bank shares and UGX13bn from Uganda Clays shares,” Jamwa said.

As a result of the good financial year, NSSF members, estimated at about 200,000, will benefit from this profit in terms of higher interest on their saving, when they retire. NSSF plans a phased increase in its members' savings from 7-12%, in a period of about five years.

“We are mandated by the NSSF Act to adjust the interest we pay to members according to the fund's financial year, giving us room to adjust the interest upwards and our members should expect an announcement very soon,” he said.

In addition, Jamwa said NSSF also recovered money to the tune of UGX32bn from a number of employers that had been defaulting. Among them was the Central Bank (Bank of Uganda) which paid up to UGX15bn arrears and the Inspectorate of Government which paid UGX1bn.

The recovery has been a result of the stepped up efforts to recover arrears from defaulters. The fund has also been publishing names of defaulting employers, in local newspaper publications, in order to ensure that they remit contributions for their employees.