National Social Security Fund (NSSF) members will get 10% as interest for their savings which translates into shs1.58 trillion and this will be credited to their accounts, the Ministry of Finance has announced.
“In exercise of the powers conferred on me by section 35 of the NSSF Act, I have the pleasure to declare an interest rate of 10 % to be paid as interest to the members of the fund,” Finance Minister, Matia Kasaija announced on Tuesday during the 11th NSSF member’s meeting at Kampala Serena Hotel.
The interest is higher than the 9.65% paid out to members last year.
He congratulated NSSF board and management for posting remarkable performance on almost all key performance indicators.
“I am especially glad the Fund’s assets against registered growth to shs18.65trillion. Many naysayers didn’t imagine the possibility of growing this Fund to shs20 trillion that we will achieve this strategic objective, a year ahead of schedule and it is laudable.”
He said the total income of shs2.2 trillion realized shows the productivity of investments that government approved .
Earlier this month, NSSF announced that its revenue increased by 15% from shs1.9 trillion to shs2.2 trillion for the financial year ended June 30, 2023.
NSSF Managing Director, Patrick Ayota said the Fund’s dividend income accruing to equity grew from shs84 billion to shs139 billion whereas the real estate projects slightly increased from shs13.4 billion to shs14 billion.
The development comes on the backdrop of scandals that rocked the Fund involving the Gender Minister Betty Amongi and former NSSF Managing Director, Richard Byarugaba who was accused of mismanagement of the Fund.
The scandals played out in parliament and the Inspectorate of Government that investigated the Fund and its top management.
Members of parliament later recommended that the minister must resign with immediate effect on account of abuse of office after it was found out that found that her actions in directing Shs6 billion to be availed to her ministry were irregular.
Amongi however, said that she cannot resign based on a falsehood by the report and she maintained that the request of Shs6 billion was within the National Social Security Fund (NSSF) Act.
“I have been condemned without evidence, facts and reference to points of the law. Infact I am being victimised yet I am the whistle-blower,” she said.
Amongi explained that her letter directing the appropriation of Shs6 billion was in exercise of ministerial power under Section 29 of the NSSF Act which gives her power to amend the budget.
“Activities of the Shs6 billion do not fall under Ministry of Gender and I want to state that the new law introduced mid-term access and the law permits me to issue regulations for voluntary savings. I am required to carry out stakeholder engagements and I cannot do that alone,” she added.
As the dust seemed to settle, the minister earlier this year appointed Patrick Ayota as the new NSSF Managing Director to replace Richard Byarugaba, prompting the latter to run to court to challenge the decision.
The case is still in court.
The decision also promoted murmurs from sections of the public, most of whom questioning the manner in which Byarugaba was booted out of NSSF.
Speaking on Tuesday, Ayota admitted that the scandals affected the Fund but was quick to point out that NSSF remained resilient.
“The Fund was under serous scrutiny from parliament and IGG but despite the internal disruptions, the Fund remained strong and resilient. The members never lost trust in us,” Ayota said.
He said NSSF paid out shs1.2 trillion to members, adding that the proportion of benefits paid to contributions has been increasing year by year, which he said points to a maturing fund.
He said last year, NSSF collected shs3.3 trillion, spent shs190 billion and realised shs2.2 trillion in income.
According to Ayota, shs17.4 was generated in revenue for every shilling the Fund .
NSSF recently unveiled a 10-year strategic plan that will see the Fund hit the shs50 trillion mark by 2035 have a 50% coverage and 95% customer and employee satisfaction.
The NSSF Managing Director said on Tuesday that the Fund’s assets under management currently stand at over shs18.6 trillion having grown by 8% and retaining its position as the largest social security Fund in East Africa by value.
Customer and staff satisfaction stands at 85% and 86% respectively, while the benefits payment timeline stands at 11 days.
The Fund has 2.2 million registered members, 882000 registered employers with 456000 active employers, 17 branches countrywide, 579 staff.
The Minister for Gender, Betty Amongi said she was pleased with increased collections by the Fund despite the difficulties that “confronted us” in the transition from Ministry of Finance to the Ministry of Gender.
“To me leadership demands we must not run away from tackling even the most difficult challenges so long as we stay focused. Leadership is tested during the hardest of times and not during the most peaceful times,” Amongi said.
She hailed management for continuing to steer the ship despite all the “negativity” and today we see the positive outlook.