We will continue to focus on driving shared value and sustainable growth and tackling the most pressing challenges faced by our customers, employers, and the communities in which we operate
In the first half of the financial year, Covid-19 continued to impact the way we live and operate, with further uncertainty caused by continued outbreaks of the Covid-19 variants. Fortunately, the global rollout of vaccination was instrumental in driving increased economic activity and demand due to the removal or relaxation of lockdown restrictions.
The second half of the year was characterised by high inflation rates and supply chain disruptions, mainly due to the Russia-Ukraine war that has threatened a prolonged effect on the global economy. The world economy is continuing to pay a hefty price for the war, driving weaker growth, higher inflation, and potentially long-lasting damage to the supply chains.
The increase in inflation led to an increase in the interest rates and saw the Bank of Uganda increase the CBR from 6.5% to 7.5% towards the end of the financial year. This led to the weakening of the Uganda Shilling. These were compounded by the poor performance of the regional stock markets due to the Covid-19 pandemic and related supply chain disruptions.
The knock-on effect was a natural withdrawal of foreign investors from the East African capital markets to their economies leading to the collapse of share prices. This drop in prices resulted in significant losses in our stock market investments.
However, the most important good news for Uganda in the FY 2021/22 was the signing of the Final Investment Decision ($10Bn) to produce oil and gas. The first unit of oil is expected to come out of the ground in 2025.
The Balance sheet size grew by 10.9% from UGX 15.56Tn to UGX 17.25Tn and 0.3% above the target of UGX 17.19Tn
Total income grew by 12.7% mainly driven by Fixed Income interest that increased by 12.1%
The accumulated members’ balance grew by 10.9% to UGX 16.96Tn compared to UGX 15.30Tn in the prior year
Benefits paid in the year increased to UGX 1.189Tn, 85% above UGX 642.3Bn paid in the previous year. This was mainly driven by the introduction of the Midterm Access Benefit
The leadership team can equally be proud of the work it has done to make NSSF a great example of a business that strives to be responsible, sustainable, and ethical. The ESG (Environmental, Social, and Governance) principles have been successfully integrated into the business for several years now and this year, we showcase this in our Integrated Report. These non-financial factors and their increasing interconnectivity and convergence play a vital role in the Fund’s decision-making and analysis of growth opportunities and material risks.
During the financial year, the Fund carried out an Organisational Redesign aimed at improving our processes, removing duplications to serve our members better, and preparing for the change in our business model mainly driven by the amendment of the NSSF Act. Read more on the Fund’s organisational Redesign.
On the technology front, we launched a new Pension Administration System OctoPAS to improve the efficiency of our processes and reduce redundancy in our back office.
Enhancements to our customer servicing were made by leveraging our end-to-end digital capabilities and artificial intelligence tools. I am delighted to report that these initiatives are already paying off as can be seen in the improvement of our overall customer satisfaction and net promoter scores during the year.
In our Hi-Innovator Programme, we continue to provide seed capital to promising entrepreneurs to pave way for growth opportunities for our young population and the economy of Uganda.
Our focus for FY 2022/23 is to continue putting our customers first by consolidating and simplifying systems and processes that remain a barrier to building an agile business and leveraging technology and partnerships.
We will continue to focus on driving shared value and sustainable growth and tackling the most pressing challenges faced by our customers, employers, and the communities in which we operate.
We will continue to look for more diversification opportunities in the investment portfolio within Uganda and the East African region specifically in both fixed income and equities.
We will continue to create an enabling and exciting work environment aimed at retaining and attracting top talent to the Fund that will enable us to achieve our strategic goals and objectives.
As the pace of change accelerates, we will need to continually adapt and evolve. To flourish in such an environment requires one to embrace change while capitalising on the opportunities presented.
Having an updated operating model, the Executive Committee and our teams are working tirelessly to achieve the strategic targets we have set. To execute our strategy, we know that we must deliver on the short-term priorities while investing in our future success.
It is my great privilege to be leading the Fund as it enters this exciting new era of “Now we Can” which will enable us to empower our members to take charge of their financial future!
I would like to thank the Chairman and the Board for their support in developing and delivering on the Fund’s strategic objectives. I also extend my appreciation to the Supervisory Ministries and the Regulators for their unwavering support provided throughout the financial year.
My thanks are also extended to the Executive Team for their commitment, passion, and dedication to making the Fund a success. To all our stakeholders, thank you for your continued support and mutually rewarding engagements.
Finally, to all Fund employees, thank you for your inspiring courage and resilience and for effortlessly supporting our members as we strive to keep being the Social Security Provider of Choice.