By KT Reporter
The National Social Security Fund (NSSF) has asked the government to allow it participate directly in the development of the country’s infrastructure projects.
NSSF that grew by 17.5 percent in 2024/2025 financial year to UGX 26 trillion, has most of its investments in the financial markets (stocks) in Uganda and the rest of the East African Community stock markets, with some in real estate sector especially in Uganda.
A substantial amount has been lent to the government, with the Fund being the largest lender. Speaking at the 13th Annual Members’ Meeting, NSSF Managing Director, Patrick Ayota said the Fund has the capacity to finance projects like the Jinja Expressway if given the chance.
The Ministry of Finance, Planning and Economic Development announced a 13.5 percent interest for NSSF savers. Minister MAtia Kasaija’s announcement of a higher rate from 11.5 percent was on grounds that earnings grew by 11 percent to UGX 3.52 trillion in the year. Ayota says this will save Uganda from always seeking foreign financing. However, he says to take on more investments, there is need to ensure that more Ugandans save.
The NSSF Act sets limitations on how much of its money the Fund can invest in which jurisdiction, with government Securities within EAC given up to 80 percent, while it can invest up to 70 percent in shares of companies quoted on a stock exchange within the region.
Fixed and time deposits in licensed financial institutions within the EAC may take up to 30 percent, while only up to 30 percent may be invested in immovable property in Uganda and 30% in corporate and mortgage bonds within the EAC.
The law allows that up to 15 percent of the Fund’s resources may be invested in private equity within the EAC, while cash and demand deposits in EAC-licensed institutions can take up to 5 percent.
The policy provides a framework to invest within acceptable risk levels while aiming for strong returns for its members. By the end of last financial year, NSSF’s actual asset allocation was 80.5 percent in fixed income, 13.3 percent in equities, and 6.2 % in real estate, a structure which was within the URBRA limits.
Currently, the NSSF has already submitted the letter to the Ministry of Finance requesting for approval to invest in government programmes, according to David Ogong, NSSF Board Chairperson.
Ogong says this will partly enable NSSF to achieve their 10-year vision that aims at growing the Fund’s assets under management to UGX 50 Trillion from the current 26 Trillion. He adds that they intend to diversify their investment strategy into alternative investment products, especially in the informal sector, but that the main focus will continue to be the Bonds, equity and real estate.
While both the Ministers of Finance Matia Kasaija and of Gender, Labour and Social Development Betty Amongi did not respond to this investment in government infrastructure, they hailed the Management and the Board for thinking long-term.
The main focus was in diversifying into products that attract more people, especially low income earners and those in the informal sector. Minister Amongi says that this was one of the reasons behind the amendments to the NSSF Act and the subsequent regulations; the NSSF Voluntary Contributions and Benefits Regulations of 2024 that were issued last year.
These enabled people to save voluntarily as low as UGX 5,000, and at least UGX 29 Billion has been saved under this by about 39,000 voluntary savers.
The minister noted a request from the public that the daily savings minimum limit be set at UGX 1,000 so as to enable even lower income earners to save.
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