I THINK it was Eddie Cross who once mentioned that since its formation, the National Social Security Authority (Nssa), has received contributions worth US$25 billion and today, there is a measly US$2 billion in the pot.
That is not surprising at all given the culture of non-accountability and hidden incompetence within State-owned enterprises (SoEs).
What surprises me is the appointment of individuals without the requisite asset management skills to run what is essentially a national savings scheme.
I have written on this before, but clearly nobody is listening or they are listening but cannot do the right thing due to patronage and vested interests.
For me, the problem starts when ministers are changed and they bring on board whoever they like and not necessarily the one with the best experience.
We have numerous revolving doors within State-owned enterprises and they are costly and bring in unnecessary inefficiencies.
I do not like to throw names around, but clearly, the Nssa board has hugely failed in its mandate to protect national savings and to maximise rewards to beneficiaries who are the contributors to the fund.
For example, pensioners receive around US$40 every month while executives’ cellphone bills, travel, allowances, TV subscriptions and so on gobble thousands of dollars.
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That is despicable.
The Nssa savings pool can make a significant economic impact through a well-articulated investment philosophy, which must be consistently and competently implemented.
It can also provide long-term developmental capital to boost the economy.
Yet all we hear is maximisation of salary packages and conferences abroad.
That is simply unacceptable.
In other countries, those who are appointed on such boards as Nssa’s are not only qualified individuals, but face constant ethical scrutiny to ensure they have no conflict of interests and are not doing any side deals that may cloud and compromise their judgement.
They are also accountable for the returns to the fund and benefits paid out to pensioners, including regular performance reviews to ensure they do not lose sight of their mandate.
We need a professional approach.
There is no doubt that we urgently need a complete reform of Nssa because if a nation fails to manage its savings base, the economy is injured for the lack of long term capital, which is exactly the case now.
How should Nssa operate?
First, we must appoint competent board members who have the requisite skills, foresight and ethical standards.
Parliament must also have oversight and approve board appointments.
We must have an investment philosophy which guides investment strategy at the institution.
We must see more transparency and accountability to Parliament.
Nssa activities must be scrutinised and monitored regularly to ensure they are within mandate.
Regular public reports are essential.
We must see more input from beneficiaries and contributors to the management of the fund.
That is, citizens must be represented on the board.
We must also ensure that we bring in new ideas and fresh mindsets in the management team.
Early retirement is urgently necessary.
We must see a reduction in political influence and appointments.
Most times, I have been quite shocked on who gets appointed and also at the type of investments made.
It will only be through a new paradigm and totally new mindset that the people’s savings pool will be managed efficiently to the benefit of those who contribute and the economy as a whole.
The fact is we have these skills, but politics continues to stifle everything.
- Vince Musewe is an economist. He writes here in his personal capacity. He can be contacted on vtmusewe@gmail.com.
