The managing director National Social security fund NSSF, Richard Byarugaba says the fund will not use its members’ money to bail out irresponsible tycoons as alleged in some media reports.
In a press note, Byarugaba informed all fund members that providing funds for loss making businesses falls short of the requirements of both the Fund’s Investments Policy and the Uganda Retirement Benefits Regulatory Authority Act (2011).
“We refer to media reports alleging that the Fund has been approached to provide bailout funds for a number of businesses in Uganda. We would like to inform our members and the general public that the Fund will not provide funds for any bail outs.”
According to the MD, the Investment Policy provides that the Fund can only invest in private equity firms that have registered strong growth and have plans to list on the Uganda Securities Exchange (USE).
Section 68(1) of the URBRA Act (2011) strictly prohibits lending to any person or institution, except through securities sold on the open market. It also prohibits direct or indirect lending, and use of scheme funds as security for loans.
“In this regard, we wish to reiterate that the Fund’s investment decisions are made in the interest of the Fund’s members.”
The Fund has adopted an investment approach that is both aggressive and yet prudent and we are confident that our focus on strategic domestic long term investments will drive growth of the Fund in the medium and long terms.
Talk of the bailout has attracted criticism from the public, economists and members of parliament who believe tax payers’ money should not be given out to some irresponsible rich families who only care about their life styles and family well beings instead of the country as a whole.
MPs want the businesses that are seeking a bail out well scrutinized to understand the role they play in the development of this country including how many Ugandans they employ in their businesses.
