The Managing Director of the National social Security Fund (NSSF) Richard Byarugaba has revealed that member contributions increased by only five per cent from Shs1.22 trillion to Shs1.28 trillion.
According to Mr. Byarugaba, the marginal growth is attributed to the amnesty they offered to businesses that were affected by #Covid-19 pandemic.
“The fund’s operations were impacted by the economic slowdown, occasioned mostly by the pandemic. Economic slowdown also had a ripple effect on the fund’s business, and contributions were affected. Contributions grew at 5.2 per cent,” he said.
“I am glad to report that the fund is resilient as exemplified by the generally good performance we registered. As the economy rallies to recovery, the fund will shake off effects of the pandemic in the medium term.”
Despite the outbreak of covid-19, Byarugaba said Uganda Shilling remained resilient against the USD and Kenya Shilling. The Kenyan and Uganda shillings cross closed at 35.02 in June 2020 compared to 36.10 in June 2019, a depreciation of three per cent. The Tanzania Shs cross closed at 1.6108 in June 2020 compared to 1.6065 in June 2019.
The money paid in benefits to qualifying members increased by eight percent from Shs 450 billion in 2018/2019 to Shs 486 billion in 2019/20.
According to Fund’s performance for the Financial Year 2019/2020, in the previous year, Total Revenue reduced by 44 per cent to Shs891 billion in 2019 from Shs1.6 trillion in 2018, affected foreign exchange and equity positions value reduction of a reduction of Shs 402 billion.
Dividend income reduced by 19 per cent from Shs 77 billion as at June 30, 2019 to Shs62 billion as at June 30, 2020 due to cancellation of dividend payouts by commercial banks.
Total Revenue increased by 17 per cent from Shs1.25 trillion in 2018/19 to Shs1.47 trillion as at June 30, 2020, driven by growth in interest income as a result of exposure to high yielding fixed income investments and rental income.
“In the previous year, Assets under Management increased by 13.1 per cent from Shs9.98 trillion to Shs11.3 trillion at 30th June 2019,” he said.
Equity Markets suffered significant loss of value, the Uganda Stock Exchange lost 9.8 per cent, the Nairobi Exchange lost 8.0 per cent, and Rwanda Stock Exchange lost 10.4 per cent, only the Tanzania stock market gained 5.6 per cent. This has affected the Fund’s equity holdings across the region.
“If you have been paying attention to Uganda’s skyline, it has been changing because of the rising Pension Towers. Our projects were not affected much by the lockdown.”
Assets under management increased by 17 per cent from Shs11.3 trillion to Shs13.38 trillion as at June 30, 2020, mainly driven by increased contributions and interest income. The performance was influenced by the economic downturn in Uganda and East Africa due to the impact of the #Covid-19 Pandemic Lock Down, it is therefore unlikely to pay members a double-digit interest rate.
“We will endeavor to keep our promise made to our members when we launched our 10-year Strategic Plan; which is to pay at least the 10-year average rate of inflation + 2 percentage points,” he said.
Click on the link below to read the statement.
2019-20 Performance Press Release final
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