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CHRISTOPHER KHISA: NSSF defies Covid to grow asset by 12 per cent

The growth has been achieved despite harsh economic conditions, and a court case

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by CHRISTOPHER KHISA

News21 September 2021 - 09:05
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In Summary


• NSSF is a landlord to more than 50 ministries, departments and agencies.

• Stakeholders are assured that NSSF is a major supporter of this economy going by its strategic investments spread across all sectors of the economy.

Hazina Trade Centre

The National Social Security Fund has achieved a net growth of 72 per cent translated from an increase of Sh165.5 billion in June 2015 to Sh285 billion in June 2021.

The 12 per cent growth per year in six years has been achieved despite harsh economic conditions, a court case that stalled the full implementation of the NSSF Act 2013 and the outbreak of the Covid-19 pandemic.

Contrary to recent media reports and perceptions that the fund spends Sh64 for every Sh100 collected, such ratio-calculation is incorrect. The fund’s expenses are based on and compared with the income generated and not members’ contributions.

The NSSF Act 2013 allowed the fund to spend two per cent of net assets and not total members’ contributions. The fund has managed to spend 2.45 per cent of its net assets, despite the court case, which has restrained NSSF from collecting the enhanced contributions envisaged in the Act.

Guided by the Retirement Benefits Authority regulations that guides the funds in all its investment policies, NSSF invests in government securities worth Sh154 billion, Sh28 billion in Safaricom, Sh27 billion tier 1 and 2 banks (KCB Bank, Coop, Absa, Stanchart, Equity among others).

NSSF is a landlord to more than 50 ministries, departments and agencies. Stakeholders are assured that NSSF is a major supporter of this economy going by its strategic investments spread across all sectors of the economy.

Some reported losses at the Nairobi Securities Exchange in some entities has been “paper loss”, which happens to all investors in stocks depending on the general economic performance in local and international markets.

With improved economic situation, recoveries are made, a matter that shouldn’t worry members.

Furthermore, investment decisions of the fund are made by top managers as guided by the RBA Regulations.

Living by the spirit of “mobilizing local resources for national development”, all NSSF members should be proud that through the fund, they have been able to live to our National Anthem ‘Pamoja tujenge nchi yetu’.

NSSF ensures openness, accountability and transparency to its stakeholders by ensuring the Auditor General audits its accounts on an annual basis.

The fund is also required by law to annually publish its accounts in the Kenya Gazette and in the local dailies. It is one of the few public entities required by law to publish its accounts. That should give confidence to all its members and Kenyans in general.

NSSF members are at liberty at all times to check the status of their contributions at their convenience by using USSD code *303#.

Members can also register and check their statements from the comfort of their phones using the same USSD code. Services can easily be accessed at any of our 49 branches and all Huduma Centres countrywide. Members can also log-in to the NSSF online self-service (eservice.nssfkenya.co.ke) to access all their desired services.

On the recovery of member contribution arrears and penalties, NSSF has ensured that all outstanding contribution debts are followed up through formal demands as per the Fund Compliance Process.

Additional effort and strategy have been deployed to recover contribution arrears and penalties owed by employers. These include instalment undertaking arrangements, filing of court cases through the DPP and engagement with government institutions to recover arrears and penalties owed by defunct local authorities.

These government institutions steering the debt recovery process include the Ministry of Labour and Social Protection, the Council of Governors, and the Intergovernmental Relations Technical Committee.

The unremitted member contribution by some employers is actually not unaccounted for money by NSSF as implied in the Auditor General’s report. These are known monies in form of member contributions owed to the collector (NSSF) and are being pursued vigorously by the Fund to be credited to member-accounts.

The penalties that come with such owed monies cater for the cost of collection of the contributions by the Fund and delayed interest on member accounts deriving from the missed investment opportunity.

NSSF has also open its door to Kenyans in the informal sector to save with the Fund. The move is in addition to the existing legal frameworks that only allowed membership from the formal sector through their employers as statutory obligation.

The launch of the Habahaba informal sector savings program in 2019 demonstrates that the informal sector is the biggest creator of jobs and shouldn’t be left behind especially in the critical endeavor like saving. The Fund has thereafter come up with products targeted at this critical informal sector to address the gap.

All employers who engage at least one worker are also required to register themselves and their employees with NSSF.

Christopher Khisa is the PR and communications manager, NSSF

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