The amount of the Fund will increase to Sh20 trillion by June 2024, a year faster than anticipated, according to the National Social Security Fund (NSSF).
The NSSF managing director, Mr. Patrick Ayota, stated in data supplied ahead of the Fund’s annual members’ meeting scheduled for this week that assets under administration were forecast to increase to Shs20 trillion by 2025, although reaching the growth by June 2024 remained a strategic aim.
According to the predicted growth, the NSSF will expand the Fund’s size by at least Sh1.5 trillion over the medium term, from Sh18.56 trillion in the year ending June 2023 to Sh20 trillion.
“Based on the Fund’s performance in [the] 2022/23 [financial year] , we project that the strategic goal of growing the assets under management to Shs20 trillion by 2025 will be achieved by June 2024, one year ahead of schedule,” Mr Ayota said.
The assets of the NSSF increased by Sh1.32 trillion from June 2022 to June 2023, going from Sh17.26 trillion to Sh18.58 trillion.
The increase fell short of the Shs1.5 trillion that NSSF hoped to raise to reach the Shs20 trillion threshold, though.
However, NSSF has increased a variety of initiatives, many of which aim to boost both mandatory and optional member recruitment.
The Fund is also expected to increase in terms of revenue from assets such stocks and real estate, which increased by Shs326 billion from Shs1.87 trillion to Shs2.2 trillion during the period ended June 2023.
Even if the Fund continues to perform well and be profitable, Mr. Ayota said that its current size is far from ideal and that there is a need to increase the Fund’s long-term sustainability.
As a result, he explained, the foundation of the Fund’s long-term strategy under Vision 2035 will center on increasing assets under management to Sh50 trillion, with a coverage of at least 50% of the working population.
One of the most successful businesses in East Africa, Safaricom in Kenya, is one of the investments the NSSF has made, according to Mr. Gerald Paul Kasaato, chief investment officer and acting deputy managing director.
He said that other investment vehicles, particularly in government debt and blue ship enterprises, had been made in Tanzania and Rwanda.
According to Mr. Kasaato, the NSSF holds investments worth 12.51 percent in stocks and 9.01 percent in real estate. 78.48 percent of the total amount is kept in fixed income.
