NSSF refutes claims of political influence

The National Social Security Fund (NSSF) has denied allegations that it is being pressurized by politicians to lend out part of the savers' money to the government.

This comes after reports emerged that government wants to borrow Shs 1 trillion from the fund to construct ministerial offices in Bwebajja along Entebbe road as well as other allegations that minister of Gender, Labour and Social Development Betty Amongi, who is a co-supervisor of NSSF had requested for Shs 6 billion for supervisory activities.

NSSF deputy managing director, Patrick Ayota says the NSSF management is not in any way being compromised by politicians and the government to give away part of savers' money. He added that even the few times they (politicians) have tried to compromise them, they have not allowed it to happen.

"Yes, the government has at times made calls wanting to get money but we have told them to their face that we can't do it because it is against the law and they have backed off. No money has left the fund. The only way the government borrows from the fund is through the treasury bonds issued by the central bank and that is what the law allows. They can't just walk in and ask for money and that is why we are very comfortable about the safety of our members' funds because the government has a sovereign responsibility of paying back what they owe no matter what regime comes to power," he said.

Ayota further noted, "We have processes in this fund. Many people think that we have got sacks of money lying around and if somebody in a position of power just writes a chit, we just pull out a sack of cash and give them. Yes, the fund has money but not in cash just lying around idle. Most of the money is invested or is in the banks and the process to get it involves so many layers."

According to a leaked letter from minister Amongi, the NSSF board in November last year went to Kapeeka, Nakaseke district and met with President Yoweri Museveni's brother, Gen Salim Saleh on issues regarding the management of the fund.

Ayota however revealed that he was not invited to that said meeting, and therefore doesn't know what was discussed there. He further denied receiving any letters/chits from State House asking NSSF to give them money.

The issues regarding the management of the fund and allegations of government trying to borrow money from it have been serious debates among the public for the past weeks and as a response to this, Ayota revealed that the NSSF board has met four times in the last two weeks to try and find ways of cleaning their image although he remained tight-lipped about the results of those meetings.

"We have also had 3 staff meetings over the last three weeks because our staff also had questions about what was going on at the fund. So we have engaged them, answered their questions, reassured them about their jobs; and over the last one week, our staff have been more focused about their work."

Performance

NSSF released its half-year performance results which show that it is on track to achieve its key performance targets for the financial year 2022/2023 after its contributions collections and realized income grew by 22 per cent and 17 per cent respectively for the half-year ending December 2022.

Half-year contributions collected by the fund topped Shs 786 billion compared to Shs 643 billion over the same period last financial year. Realized income also topped Shs 1.054 trillion in December 2022 from Shs 900 billion over the same period last financial year, driven by higher interest rates in fixed-income investments.

"This half-year performance which is better than what we achieved over the same period in the last financial year puts us in a very good position to achieve our 2022/2023 targets. It also shows that our members, with employers and workers, have trust in the fund as their social security and savings partner," Ayota said.

NSSF asset size also increased from Shs 17.65 trillion in July 2022 to Shs 17.88 trillion in December 2022. Although the rate of growth reduced compared to the same period last financial year. This reduction is attributed to increased benefits payout.

NSSF paid Shs 712 billion over six months in December 2022 compared to Shs 364 billion over the same period in the previous financial year.

"The increase in benefits payments does not surprise us because this is the trend in the first half of the year as qualifying beneficiaries tend to wait for interest rate declaration at the end of September every year before they submit their benefit claims. That is why in the month of October and November following interest rate declaration, we paid Shs 217 billion and Shs 208.6 billion respectively," Ayota added.

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