Kampala, Uganda | URN | The Managing Director of the National Social Security Fund (NSSF), Richard Byarugaba has said that they will have no option but to pay the 20 per cent to each saver as long as it is approved by Parliament.
Members of Parliament are debating a midterm access of the funds for NSSF savers who have also been hit hard during the coronavirus (COVID-19) lockdown, but NSSF had warned that the fund will crush if it pays the 20 per cent to each saver when approved. By March 31st, 2020, NSSF had a total member portfolio of 11.4 trillion .
In a letter to the Finance Minister dated May 5, 2020, Byarugaba says the fund will have to pay at least 3.7 trillion Shillings to savers who are affected by COVID-19 and also savers above 55-years, the legal age where one can draw their savings.
He argues that they do not have physical cash but would have to sell treasury bonds to meet benefits payments but also NSSF assets.
In an interview with this publication, Byarugaba however said that everyone is blaming them for failing to allow Ugandans to access the money, but this problem is not only theirs but also for Members of Parliament.
He says for now although they are not in support of releasing the funds because it will stress the funds, the MPs are the ones who should be taking the blame since they are sitting on the law that could have encouraged Ugandans to get midterm access.
“The law doesn’t give us any leeway to help our members, the law that could have given us leeway has been in Parliament since last year and the MPs haven’t agreed who should be in charge of NSSF. And in the meantime the law that should have helped us to help our members during this period is sitting in their interest since last year,” reasoned Byarugaba.
The NSSF boss added that although they are currently being attacked by the public on social media among others, the people who should be taking the blame should be members of Parliament. “They have the law that would even allow members to get benefits. We could have been able to do that, but we can’t do that because we would go to jail,” said Byarugaba.
He says NSSF empathizes with the savers and they are actually hit by COVID-19 and they would be able to help if the law was passed. He says what they wanted is to make the policy makers to know the dangers of allowing the access to that money which they do not have in their accounts.
“NSSF would pay it, but members would know that they would loose money because your balances will be reduced by the loss that we make,” says Byarugaba.
According to Workers MP Sam Lyomoki, their proposal is that Ugandans beyond the age of 45 and those that have saved for 10 years will be the one to benefit from the proposal.
NSSF assets are at 13 trillion invested in Kenya, Uganda, Tanzania and Rwanda. NSSF has 2.3 million members at the moment. However, close to a half (1m people) have less than 10 million on their accounts. Some 7 per cent (161,000) people have balances above 50 million, an indicator that only a paltry of savers have sizeable savings.