NSSF standoff: Executives defend real estate investments before Parliament select committee

The National Social Security Fund has defended its performance over the last 10 years before the Parliamentary Select Committee investigating the National Social Security Fund (NSSF) and the appointment of the Managing Director and Deputy Managing Director.

The Committee is chaired by Hon. Mwine Mpaka who is the Member of Parliament for Mbarara City South. Other members of the committee include Workers MP Hon. Charles Bakkabulindi, Mr. Karim Masaba (Industrial Division, Mbale City), Mr. Michael Kakembo (Entebbe Municipality), Ms. Fortunate Nantongo (Kyotera District Woman), Ms. Laura Kanushu (Persons with Disabilities), and Mr. Amos Kankunda (Rwampara County).

The NSSF Ag. Managing Director Patrick Ayota said that the Fund’s growth in asset base, contributions, benefits, and membership growth has been growing steadily over the last 10 years.

Ayota was on Feb.01 appearing before the committee alongside the Fund’s senior management team to interface with the committee on Fund’s performance, governance, and stakeholder involvement in the Fund’s decision making among others.

“In 2010, the Fund was worth Ugx1.7tn in Assets under Management. As at end of FY 2021/22, the Fund was Ugx17.3 trillion in assets, a 10-fold growth.  As of December 2022, the Fund’s assets stood at Ugx18.8 trillion,” Ayota said.

The NSSF Board, led by Peter Kimbowa had earlier in the day interfaced with the same committee.

Kimbowa was quizzed about the Ugx6bn that the Minister of Gender, Labour and Social Development allegedly asked the Board Chairman in a letter to provide for in the Fund’s budget for the Financial Year 2022/23. He told the committee that the Minister’s letter was irregular.

On contributions, Ayota said the member contributions have steadily increased from annual collections of Ushs 556 billion in 2012 to Ushs 1.491 trillion in 2022.

On member recruitment, Ayota said that the current membership size stands at 1.3m with a historical annual growth rate of 140,000 more members, while the current employer base is 27,628 with a historical annual growth rate of 2,685 more employers.

Regarding real estate, Ayota clarified wrong information that the Fund’s real estate investments do not provide a return to members and are out of reach of the majority of NSSF savers.

He said that the Fund earns rental income and capital gains from its investments in real estate. He also said that the Fund’s Real Estate offering targets 3 groups of consumers.

These are the high-end income bracket catered for under the Citadel Place Project (sold out), Solana Lifestyle and Residences – Lubowa Housing Project; middle-income bracket – catered for under Kyanja Housing Project and Temangalo Housing Project, and affordable Housing income bracket – catered for under the Temangalo Affordable Housing Project (with starting house price of Ugx90m).