Business

Inside Byarugaba's 3-year Term At NSSF

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viagra 60mg http://danmarknorge.org/wp-includes/class-wp-rewrite.php geneva; font-size: small; line-height: 200%;”>The first two years saw Byarugaba introduce radical reforms that transformed the fund into one of the best managed institutions in the country, with customers realizing a 11.23 percent interest rate on their earnings in 2013.


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This was an increase from 10 percent rate paid to NSSF members in the previous Financial Year.


Over 1.3 million contributors to the Fund therefore earned a total of Shs 278 billion compared to Shs 202 billion that was paid out in 2012.


The rate was calculated and credited on the balance on the members’ accounts as of 1st July 2012.


Observers attributed this to the strategic exploitation of the investment environment by Byarugaba and his administration.


Speaking in June this year, Byarugaba said that the last three years have seen the Fund grow in all dimensions.


“This year, the engine of growth has been the improved compliance which now stands at 72 percent and prudent but aggressive investment which has led to higher revenues. Our efficiency led to better cost management.”


“Our cost income ratio is at 16 percent, better than 55 percent of the banking industry average and our cost of administration is at 2.0 percent better than most global funds of similar size like ours,” he said.

NSSF Board Chairman Ivan Kyayonka said that although the small size of the market and limited investment opportunities presented a challenge, the Fund was able to register significant progress and attained commendable results compared to the previous year.


He singled out the Fund’s earnings from its participation in the Umeme IPO. NSSF earned Shs 13 billion from its investment in Umeme – Shs 2 billion dividend and Shs 11 billion in capital gains.


Byarugaba, who has re-applied for the job, says the Fund is strong, stable and secure and that the cardinal responsibility of his administration was to ensure that the funds are invested in projects that give a good return to our members.


Commenting on the issue of impact inflation, Byarugaba said that the Fund aims at growing the value of members’ savings by ensuring that it pays interest rate which is above 10 year rate of inflation.


“Our focus is to provide a reasonable return to members, without compromising the safety of their savings, therefore, in the long term the Fund must preserve member funds. Our 2013 rate of 11.23 percent is 2 percent above the 10 year inflation rate of 9.23 percent. The Fund does preserve the value of member funds,” he added.

Alcon Case

However, the peak of Byarugaba’s reign was when the Supreme Court set aside a Shs40bn arbitral award ordered in 2009 by the Court of Appeal to Alcon as compensation for the termination of the contract to build the towering Workers’ House in Kampala in 1994.

Instead, a panel of judges led by Chief Justice Benjamin Odoki faulted Alcon Uganda directors of using fraudulent information that was “deliberately concealed” by directors of Alcon International Kenya during the signing of the contract.

Insiders say the extraordinary legal victory was spearheaded by the Corporation secretary, David Nambale, who was recruited at the same time with Byarugaba.


An artistic impression of Lubowa estate

Some big shots in NSSF, judiciary and government had connived to ensure NSSF pays shs40bn to Alcon even when it was very clear that the contract had been handed to Alcon Uganda fraudulently.

The legal gymnastics at the time blindfolded Ugandans from the truth, titling the case in favour of the mafia.

Led by Chief Justice, Benjamin Odoki, court ruled that Alcon Kenya misled NSSF when it substituted one company with another during the signing of the contract.

It is widely thought had it not been for Nambale’s intervention, the NSSF customers would have lost a staggering shs40bn to the greedy clique of mafia.

Infighting

Sources say Finance Minister, Maria Kiwanuka has on several occasions made it clear to powers that be that she wants Byarugaba and Nambale out of office.

This stemmed from a whistleblower’s report that faulted Byarugaba and Nambale in alleged fraudulent land deals. They denied the allegations.

Sources say the duo was questioned by officials from the office of Inspector General of Government and that they did not find a case against them.

There have also been cases of infighting at the Fund, with some people from the Central region exhibiting open hostility at senior officials hailing from outside Buganda.

Towards the end of 2013, NSSF announced the NSSF Lubowa Housing project which would be set up 10 kilometers from Kampala city Centre.

The project will be developed on the Fund’s 565 acres of land at Lubowa, purchased in 2003. The development will comprise of 2,741 houses, and associated amenities for middle to high income earners.

Kiwanuka, early in July ordered that all executive positions at NSSF be advertised internationally to allow a new team take over in 2014.

Summary of NSSF Performance for Financial Year 2012/2013


• Assets grew from by 27 percent from Shs 2.7 trillion in Financial Year 2011/2012 to Shs 3.5 trillion in Financial Year 2012/13.


• Contributions grew by 18 percent from Shs 472 billion in Financial Year 2011/2012 to SHS558 billion, powered by compliance level of 72 percent


• Amount of interest credited on members accounts has increases by 38 percent from Shs 202 billion in Financial Year 2011/2012 to Shs 278 billion in the Financial Year 2012/2013.


• NSSF 2013 rate of 11.23 percent is above the 10 year inflation rate of 9.23


• Benefits paid to members grew by 39 percent from Shs 101 billion in the Financial Year 2011/2012 to Shs 140 billion Financial Year 2012/13.


• Turnaround time for payment of benefits improved from 44 days in Financial Year 2011/2012 to 10 days Financial Year 2012/13.


• The cost to income ratio is now at 16 percent, better than 55 percent of the banking industry average


• Cost of administration is at 2.0 percent better than most global funds of similar size

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