Assets held by the Uganda NSSF as at September 2021 stood at $4.4 billion. PHOTO | FILE The total assets held by Uganda’s pension industry grew by 3.4 percent to $5.17 billion between July and September 2021, amid a drop in contributions and investment incomes.
The current value of local pension assets is less than overall tax revenues collected during financial year 2020/21, at $5.3 billion, according to Uganda Revenue Authority.
The latest figures compiled by the pension industry regulator show that total assets held by the National Social Security Fund (NSSF) stood at $4.4 billion at the end of September 2021, and private fund managers held assets worth $730 million. In comparison, the total value of pension industry assets stood at $4.9 billion by June 2021.
But the value of cash and demand deposits held by NSSF and local pension schemes fell from $39.7 million in June 2021 to $28.8 million in September, a trend attributed to interest payments made against members’ savings captured in the schemes’ registers by close of June every year.
Overall pension contributions made by employers dropped from $137 million in June 2021, to $110 million in September 2021, according to Uganda Retirements Benefits Regulatory Authority (URBRA) records. The drop is due to the 42-day lockdown between June and July that prompted job cuts and pay cuts in some organisations. Falling investment income
Total investment incomes reduced from $139.9 million to $132.3 million during the period under review. Overall withdrawal payments done by pension and provident schemes declined from $44 million in June 2021, to $27.5 million in September 2021, the data shows.
“The drop in investment income during that period was possibly caused by the absence of significant maturities of government bonds that usually generate windfall interest incomes for many pension schemes. Many members of the 10th parliament lost their seats during the 2021 general election, and chose to apply for gratuity benefits from the parliamentary pension scheme. This triggered a drastic reduction in that scheme’s assets during the first quarter of 2021/22,” said Martin Nsubuga, URBRA’s chief executive.
In comparison, the All Share Index at the Uganda Securities Exchange grew by 0.87 percent to 1,511.63 points between end of June 2021 and close of September 2021.
The main trading index at the Nairobi Securities Exchange rose by 2.77 percent to 178.3 points during the same period. In contrast, the Dar es Salaam Securities Exchange fell by 1.88 percent to […]