A disagreement has broken out between the ministries of Finance and Gender over control of the Shs10 trillion National Social Security Fund (NSSF), the country’s largest pension fund.
State minister for Finance (General Duties) Gabriel Ajedra told a joint sitting of the parliamentary committees on Finance and Gender yesterday that splitting the oversight of the Fund would put savers’ monies at risk.
“NSSF is such an important institution in the economy and once managed or supervised by two or three agencies will create a stalemate in decisions and, therefore, create supervisory loopholes,” Mr Ajedra said. Presenting the Finance ministry’s views on the proposed NSSF (Amendment) Bill, 2009, he argued that his ministry is responsible for formulating financial policies in the economy and overseeing their implementation and should, therefore, supervise the Fund.
In its current form, the Bill gives oversight to the two ministries, a position Gender minister Janat Mukwaya wants maintained. She proposes that Finance has responsibility for creating checks and balances in determining borrowing from the Fund and interest payable to savers, while Gender remains responsible for social protection policies.
Committee co-chairperson Alex Ndeezi wondered why the ministry of Finance had accepted joint supervision to be drafted into the Bill despite harbouring reservations.
“I have a worry related to several ministers overseeing the Fund,” Mr Ndeezi said. “Minister [Ajedra], you have been in Parliament for many years; you know how things are run. You have said this Bill should have been presented by the minister of Finance but you allowed your colleague from another ministry to move forward with this Bill,” he said.
“Both of you are in Cabinet. We shall go ahead and generate a report and wait for drama before Parliament. They will put you to task to explain. I was wondering if you would like some more time to consult with your colleagues in Cabinet so that we have less drama on the floor.”
Mr Ajedra said although he is bound by collective responsibility, he believes NSSF should be under his docket.
He said: “We had disagreements and very strong ones. I think the Bill, as it is before you as a committee, is a compromise. There is a possibility that there will be drama. But we have to manage it. The position I submit today is what I held in Cabinet. I am not going to change it,” he said.
“I believe an institution such as NSSF has far reaching implications if not properly managed. We see a potential for conflict, a potential for non-implementation. We will see if we can reconcile that position. I will bring it to the attention of the Prime Minister,” he added.
Ngora County MP David Abala said: “It is not good to operate as if we are confused. These two ministries must sit down and address this matter. It should not even appear in our document that both ministers are the ones to manage this money. That matter should have been sorted out in Cabinet,” he said.
Appearing before the committee last month, Ms Mukwaya said a meeting chaired by Finance minister Matia Kasaija last July unanimously agreed that her ministry, which is responsible for social protection, submits to Cabinet principles for amending the NSSF Act.
Finance also objected to the proposal to have NSSF lending government directly. They agreed with the workers’ unions to allow NSSF members access their money when they are vulnerable but left the modalities open for discussion.
Debate on the Bill continues.
Past contention over dual supervision
Claims. Dual supervision of NSSF has previously been a loophole for mismanagement of the Fund. Former Gender minister Zoe Bakoko Bakoru revealed in an interview in the United States where she lives in self-imposed exile that government figures had put her under pressure to allow them access to NSSF money. Two former chief executives at the Fund - David Chandi Jamwa and Leonard Mpuuma and former board chairman Onegi Obel - were charged with graft stemming from their time at NSSF.