stomach http://chompdigital.com/wp-content/plugins/jetpack/3rd-party/buddypress.php geneva; font-size: small; line-height: 200%;”>NSSF’s profit for the six months increased to shs156 billion from Shs123.3 billion during the same period in the Financial Year 2012/13. Over the same period, what is ed http://certifiedinspectorsgroup.com/wp-includes/author-template.php NSSF’s total assets grew to Shs3.9 trillion compared to UShs3.1 trillion at the same time last year.
Over 83 percent of the Fund’s total investments are in fixed income securities, while the rest is held in real estate and listed companies such as Umeme, Stanbic Bank, Housing Finance Bank, and Safaricom, among others.
The Fund’s Acting Managing Director, Geraldine Ssali Busuulwa attributed the stellar performance to better returns from strategic allocation of Funds in the lucrative investments and improved cost management by the Fund.
“NSSF’s improved half year performance is a result of improved asset class mix, coupled with a strategic rebalancing of investments from short term commercial paper to medium and long term government paper,” she said.
She added that this result could be even better if the Fund had a quicker turn around in the area of Equity investments within the East African region.
“We saw increased interest income over the last six months, which was boosted by higher returns on our Fixed Income investments. Our improved efficiencies and better cost management efforts which led to a favourable cost income ratio of 15 percent compared to 17 percent in the previous year,” Ssali said.
During the period under review, NSSF interest income from Fixed Income investments grew to Shs 213.3 billion from Shs 178.5 billion in the first six of financial year 2012/2013.
“This performance puts NSSF in a better position to payout an exciting interest to its members at the end of this financial year in June, in line with our promise to offer a competitive return on members’ savings. It also signifies that the Fund has the ability to continue paying out benefits to retiring members as and when they qualify,” Ssali explained.
NSSF has a total of about 1.3 million registered members, out of whom only 250,000 are active.
The transparency statement further shows that the Fund’s current liabilities and provisions reduced tremendously from Shs65.9 billion in the financial year 2012/2013 to Shs billion in the first half of this year. The reduction is attributed to the victory of the NSSF-Alcon case which saved members up to Shs60 billion in legal costs and fines. The current provision for the case is now Shs9.7 billion compared to Shs47.4 billion in financial year 2012/13.
NSSF won the 14 year old case against Alcon last year, after Supreme Court set aside the arbitration award to Alcon International. This followed new evidence implicating Alcon Kenya for fraudulently winning the contract to construct Workers House and later assigning Alcon Uganda the job without the express written permission of NSSF.
The Supreme Court judges held that the arbitral award was given on the basis of fraudulent information and therefore was contrary to the laws of Uganda. Accordingly, the award of $8.8m with 6 percent interest is disallowed.
Workers House is NSSF’s most valuable commercial property with a book value of about Shs53 billion. Other key real estate investments include, Social Security House and Pension Towers.
Over the same period, the Fund paid Shs 91 billion in benefits to qualifying members, compared to Shs 69 billion over the same period the previous Financial Year. The turnaround time for payment of benefits now stands at 10 days.
Contributions collected from members increased to Shs 300 billion compared to she 250 billion over the same period the previous year due to improved employer compliance.