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Stevens Mwanje
CHIEF FINANCIAL OFFICER
Despite the unprecedented challenges the Fund had to navigate, we demonstrated more than ever our commitment to making the lives of our members better in this financial year. The Fund was able to proactively reorganise itself in terms of structure, supporting systems and infrastructure to ensure smooth adoption of the changes in the law amidst a challenging operating environment.
Despite the unprecedented challenges the Fund had to navigate, we demonstrated more than ever our commitment to making the lives of our members better in this financial year. The Fund was able to proactively reorganise itself in terms of structure, supporting systems and infrastructure to ensure smooth adoption of the changes in the law amidst a challenging operating environment.
The Fund was able to seamlessly handle all midterm benefit obligations for all qualifying claimants to ensure we lived up to our “Now You Can take charge of your future” promise.
Despite the increased pay-outs that had a direct impact on funds available for investment, the Fund was able to deliver reasonable performance that demonstrates our unwavering commitment to grow our members’ savings and offer a competitive return that consistently surpasses the 10-year average inflation threshold.
The Finance Function at the Fund continues to evolve in response to the constantly changing business environment. Technology, and a recalibrated mix of people, are at the heart of our continuous transformation journey guided by our vision of becoming a valued business partner delivering key insights for decision making.
We persistently aim at creating an agile operating structure that optimises performance which is essential for the Fund in this uncertain operating environment. Our efforts continue to pay off, and these have led to internal recognition at the departmental level but also externally at the organisational level. External recognition received in the form of awards during the reporting period included the following:
These awards are not only a testament to our commitment to excellence, but also to be transparent and accountable to our members, employers, government, and other key stakeholders.
As a Finance Function, we remain committed to undertaking the necessary transformation to remain fit for purpose and future fit to maintain excellence in line with the continuously evolving operating environment.
*NSSF wins the Integrated Report of the Year Gold Award at the FiRe Awards
The Covid-19 related uncertainty characterised the first half of the FY 2021/22. The deadly Delta Variant necessitated the Government of Uganda to institute a 42-day lockdown between June and July 2021. Infection rates and deaths had reduced drastically by the end of the first half of the year.
The regional securities exchanges, especially Nairobi and Dar es Salaam, where the Fund holds investments, experienced falling share prices due to massive selloffs by international investors who liquidated their investments in emerging and frontier markets because of preferential rising interest rates in the US and Europe.
Daily operations were not disrupted as the Fund had long embraced the hybrid operating model in addition to strong supporting technology. However, the rising commodity prices, exchange rate fluctuations and falling share prices led to a general rise in the Fund’s operational expenditure, foreign exchange losses on regional investments and capital losses on our regional Equity investments, respectively.
On the side of regulation, the National Social Security Fund (Amendment) Act 2021 was assented to by the President on 2 January 2022. The key part of the amendment that had significant financial implications on the Fund was the introduction of midterm access to qualifying members i.e., members at the age of 45 years and above who had made contributions to the Fund for at least 10 years. This necessitated a change in the Fund’s investment strategy from a predominantly long-term to a combination of both long and short-term to match the short-term obligations of the midterm access. This had an impact on the aggregated returns generated from the Fund’s investments.
Despite the challenging business environment, the Fund demonstrated more than ever its resilience and its true commitment to making the lives of its members better.
The Fund was able to fully meet all midterm benefit obligations. Total midterm benefit pay-outs amounted to UGX 440Bn. However, income generated was impacted by the reduction in funds available for investment coupled with the undertaking of short-term investments to ensure that there is enough cash to meet these obligations. That notwithstanding, the Fund remained steadfast and still managed to deliver a reasonable return for its members that surpasses the 10-year average inflation threshold.