Staff costs are one of the areas that gobble up huge sums at most organisations partly due to failure to automate processes or enter into collaborations with similar agencies to cut costs.
Indeed, it is unthinkable that the NSSF should be fed on the benefits of automation and lean staffing at this time.
These should have happened many years ago.
Reports that the administrative costs of the National Social Security Fund (Fund) are galloping uncontrollably and squeezing retirees’ returns goes against every known principle of investment management.
One has to think about life after retirement, the finance specialists keep repeating in every investment forum. Why then would a State-run pension scheme use a huge Sh172 to manage every Sh400 contribution? Indeed, the NSSF numbers for up to June 2016 go against the best practice.
While the cost should not exceed two per of the assets value, theirs now stand at 3.1 per cent, showing that a number of things are wrong with the way the Fund is managed. Although the returns doubled in the year under review, this performance is below par since, at six per cent, it was trailing the all-important inflation figures.
Staff costs are one of the areas that gobble up huge sums at most organisations partly due to failure to automate processes or enter into collaborations with similar agencies to cut costs. Indeed, it is unthinkable that the NSSF should be fed on the benefits of automation and lean staffing at this time.
These should have happened many years ago. How important the NSSF is should be read against the backdrop of old age and retirement when the pensioners have lost the power and mettle to improve their lives. It, therefore, is unacceptable, that their savings should be mismanaged by a State organisation.
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Note: The results are not exact but very close to the actual.
