Uganda’s National Social Security Fund [NSSF] is now the biggest fund in East Africa, according to the fund, which could make it one of the most sought-after institutions for finance.
According to a statement from NSSF, which was released during the members’ meeting early this week, the fund’s current asset base of Shs 4.4 trillion ($1.7 billion) as at June 30, 2014, outstripped NSSF Kenya ($1.6bn) and NSSF Tanzania $1.3bn.
“NSSF Uganda has become the benchmark for the industry both within and outside the East African region. Our performance over the last four years has laid the foundation for our future,” NSSF Chairman Ivan Kyayonka said at the meeting.
Geraldine Ssali, the acting managing director of NSSF, said the asset base widened as a result of the improvement in compliance. She said the fund’s asset has grown by more than 150 per cent over the last five years. She said annual total contribution more than doubled to Shs 638bn in 2014 from Shs 295bn in 2010. She said companies had become compliant in remitting their workers’ contributions.
Companies such as Centenary bank, MTN Uganda and Civil Aviation Authority were recognized for their contributions, which were more than Shs 500m per month.
And yet, the planned liberalisation of the pension industry could narrow the pool of contributions that NSSF receives. The process of setting up the law to liberalise the industry is nearing its final stages, with the bill under discussion in Parliament.
NSSF says it has “adopted an investment model that is aggressive yet prudent,” which will see it be able to pay out a handsome return on members’ savings.
“We are planning to diversify the investment mix by increasing our equity portfolio and changing the real estate investment strategy. We want to optimise our real estate portfolio to six per cent from 10 per cent and unlock stalled real estate investments,” Kyayonka added.
The statement added: “The fund also plans to help coordinate the government to issue long-term infrastructure bonds, and participate in the oil and gas sector.”