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The Fund Which Has Taken Time To Rebuild Could Collapse – NSSF Boss Writes To Finance Ministry On Why They Cannot Issue 20% Payout To Savers Affected By COVID19…

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NSSF boss Richard Byarugaba

National Social Security Fund (NSSF) has written to the Ministry of Finance, Planning and Economic Development (MoFPED) on the implications of advancing 20% to each of their savers.

Last week, the Speaker of parliament Rebecca Kadaga directed the joint committee of Gender and Finance ten days to table on the floor of parliament the National Social Security Fund (NSSF) bill capturing the concerns of the savers arising out of the impacts of COVID19.

However, in a letter dated May 6th 2020, NSSF Managing Director Richard Byarugaba says that the proposal will not only collapse the fund which has taken time to rebuild but it also has wider negative implications for the economy and society.

In recent weeks, there have been growing calls for the Fund to pay its members twenty percent of their balances. It appears this debate will soon be introduced on the floor of parliament Honorable Minister, we are writing this letter to share with you our understanding of the implications of this proposal to the Fund, its members and Uganda’s economy at large,” Byarugaba notes.

Byarugaba says, “The immediate impact of the proposed payout will be an increased need for liquidity. At a member’s fund value near UGX 13.0T, a 20% payout would represent UGX 2.6T. In addition, the normal benefits payout for the financial year 2020/2021 is projected at UGX 8008. As a result, total benefits payout in the next one year would translate into UGX 3.4T. After a sustained period of good return performance, some retired members have been electing to leave their savings with the NSSF. Accordingly, it can be assumed that some members may not withdraw their 20%-rendering the UGX 2.6T estimate exaggerated. However, we maintain the UGX 2.6T estimate and instead raise the normal benefits payout to UGX 1.1T from UGX 8008. This is because retired members who maintained their savings with NSSF could choose to take their money if the Fund’s financial performance falters. Members above 55 years have a current balance of UGX 5628. With a bad performance, there would be a run on the Fund similar to how banks bleed to death if savers learn that the bank’s financial position has weakened.”

He adds, “Therefore, we raise the estimate for next year’s total benefits payout to UGX 3.7T. We estimate member contributions for next year at UGX 1.2T, leaving the Fund with a liquidity requirement of UGX 2.5T excluding operating costs and contractual obligations. This extra requirement of UGX 2.5T would have to come from the Fund’s investment portfolio through a sale of some assets, specifically treasury bonds.”

“This proposal not only ruins the NSSF but also has wider negative implications for the economy and society. The Fund which has taken time to rebuild could collapse. The underperformance of the Fund would make it less attractive to members, hurting private sector savings.”

“The Fund could face legal issues on its existing contracts. The NSSF is an is key financial institution in Uganda’s economy with a long-term focus. Trading this long-term focus for short-term fixes will have more lasting impacts on our economy generally; the COVID-19 pandemic just strengthened an already existing plea by members for mid-term access to their savings. We believe a position needs to be agreed upon in passing the proposed amendments of the NSSF Act. This should allow for the introduction of new benefits relating to unemployment, medical, housing and education. To fund the additional benefits, incentives need to be put in place to encourage additional savings beyond the standard 15% contribution,” he says.

 

Below is the full document:

 

By Sandra Mukisa

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Balaam Asks For Shs.1billion From Kabushenga Led Kampala Sun For Portraying Him As A Fraudster And Extortionist…

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It seems the troubles of Robert Kabushenga led Vision Group are not about to end.

This is after events promoter and National Resistance Movement (NRM) party diehard Balaam Barugahara threatened to sue them if he is not compensated with Shs.1bn.

Through his lawyers of Isabirye and Company Advocates, Balaam claims that, Vision Group, through its weekly newspaper the Kampala Sun defamed him when they alleged that he was muscling Uganda Cranes players for a share of money allegedly paid to them by President Museveni.

“Needless to say, that the publication was false, baseless and not with any truth but has none the less damaged the reputation of our client in a manner that is irreparable, as when construed and contextualized in its natural, and ordinary meaning, or by innuendo, said article is understood to mean and to suggest that Mr. Balaam Barugahara, our client, is a criminal, an immoral and indefensible man,” Balaam’s lawyers stated in their letters.

They insist that the Kampala Sun article under the headline ‘Balaam harasses Uganda Cranes over Sevo Cash’ negatively impacted on the integrity of their client, demeaned his reputation in his capacity as a businessman and a family man in the eyes of reasonable Ugandans, East Africans, Africans and the world at large to the extent of him being viewed as a fraudster and extortionist.

“In addition to causing him to limit his interaction with his peers, contemporaries, business partners and colleagues in order for him to avoid the contempt and ridicule that he suffers when amongst them, this emotional suffering has caused him to suffer stress and affected his moods and behavior in a depressing manner,” the lawyers added.

They claim that because of such suffering, their client demands a public apology for the claimed false story and compensation of Shs.1bn.

They gave vision group only three days from yesterday to do so.

Last week, Uganda Communications Commissions (UCC) suspended Urban TV’s Scoop on Scoop gossip show after socialite Sheilah Gashumba petitioned the commission over defamatory statements from the show host Tina Fierce against her. Urban TV is another Vision Group product. Sheilah also asked for Shs.400 million compensation.

 

By Jamil Lutakome

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COCA COLA IN TROUBLE: Distributors Bitter At Beverage Company For Supplying Smelly Green Water, Woman Who Got Stomach Complications After Drinking Rwenzori Takes Them On…

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Melkamu Abebe General Manager, Coca-Cola Beverages Africa in Uganda. Inset are pictures of the bottles and cans containing green smelly water.

A group of Rwenzori mineral water distributors are bitter with Coca-Cola Beverages Africa (CCBA), the bottlers of Rwenzori mineral water for distributing Green smelly water.

The group told this website that the company distributed batches of 1.5litre mineral water bottles with green water which they deemed dangerous for their clients.

The group further told theGrapevine that batches BB 14NOV 2020 and BAT 135E,0650 (1.5liter bottles) contained smelly water while batch BB 02OCT20, BAT 093 A, 1850 of water in Jumbo cans, the ones that are mounted on water dispensers contained Green water.

The affected areas included Kasangati, Bulenga some areas in the central business district and some upcountry areas.

Some of the bottles of 1.5litres that contained bad water

Multiple sources told the Grapevine that such recklessness is sometimes as a result of not following the proper cleaning procedures when bottling the water.

Recently, a one Rosemary Adong from Kakira took on Rwenzori after she got stomach complications from taking Rwenzori mineral water.

Adong raised dust at the Namanve based plant until the manager bowed in to the pressure. Adong is currently being facilitated by Coca Cola and receiving treatment from Dr. Galukanda in Kampala.

Coca Cola is currently paying her hospital bills and facilitating her with 30,000 as transport refund every time she goes to see Dr. Galukanda.

Some of the jumbo cans on the market that contain green water

Recently, another doctor in Jinja threatened to sue CCBA for distributing water to him that had dangerous particles, he asked for Shs.15 million in damages but the company sat him down and agreed to sort the matter amicably.

When the Grapevine to Simon Kaheru the Public Affairs & Communications Director Coca-Cola Beverages Africa in Uganda (Century & Rwenzori Bottling Company), he said, “We have a very straightforward and transparent customer or consumer complaints system. Most of the outlets you mention are our regular customers who would raise such an issue directly on the spot.”

 

By Grapevine reporters

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URA Speaks Out On The Fate Of The New 150 Recruits Who Are Struggling Financially After Resigning From Their Jobs During Covid19 Crisis….

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Uganda Revenue Authority finally speaks out on the fate of the 150 new recruits who were given appointment letters to join the national tax collecting body.

Vincent Seruma the Authority’s Director for corporate affairs and communication said that they know them but the situation right now cannot allow them to accommodate the new recruits.

He explained that due to COVID19 crisis, the Authority was forced to even send half of its staff to work from home.

He noted that they did that to respect the social distancing directive in the fight against COVID19 pandemics.

The soft spoken Seruma disclosed that they explained to the new recruits but it seems they didn’t understand that is why they are running allover claiming that they were dumped.

On the issue of paying them, Seruma said that they will start receiving their salaries and other allowances when they report to their working station.

Over the weekend, over 20 new URA recruits approached this website complaining that they were dumped by their new bosses because of COVID19 crisis.

They said that on 11th March 2020, over 150 of them received appointment letters confirming them as URA staff after going through a series of interviews.

They claimed that all the new recruits, were supposed to work in the domestic and customs department and were supposed to report to their new stations on 23rd march 2020.

They claimed that when the president declared a nationwide lockdown over COVID19 pandemic, their reporting date was extended.

They explained that they went through a lot of financial hardship since many of them had resigned from their previous jobs in the middle of the month of March.

They claimed that since March, they haven’t received any salary from URA and they are now suffering at home. President Museveni declared a cleanup exercise in URA where a number of staff were fired including their boss Doris Akol who was replaced with John Rujoki Musinguzi.

 

By Sengooba Alirabaki

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