Our returns are in their own orbit, says NSS boss

As I get my 20 minutes in, the door swings open, and in walks Patrick Ayota with a fascinating blend of fluster and composure, wrapped in a chic black suit that somehow manages to look both formal and effortlessly cool. It’s a Sunday morning. Time check: 10.20 am. He pauses, scanning the room, his face a little dazed. We've never met, but I’ve spent enough time watching him from afar to know who he is.
Of course, he has no idea who I am by sight alone. His hand instinctively reaches for his phone to call me, and that’s when our eyes meet. I'm tucked away near a window at the far end of the café. The view is nice, though a group of animated Eritreans nearby are making it hard to hear anything but their rapid chatter in a language I can't place.
“I’m really sorry, I was coming from church and the road around Makerere was cut short so I had to use the longer route,” the managing director of National Social Security Fund (NSSF) says, sounding like he means it.
He brushes off my assurances that it’s okay. “Lateness is annoying,” he pronounces. Just before he made his way over, he was cornered by Jim Mugunga’s persuasive banter. The talk from the Finance ministry’s spokesperson felt endless but oddly captivating.
Mr Ayota seemed to enjoy it, nodding along, clearly enchanted. I found Mr Mugunga already in the cafeteria, comfortably ensconced at a table, completely at ease.
A week earlier, NSSF had credited its savers' accounts with Shs2 trillion in interest, each pocketing an 11.5 percent return on their balance as of July 2023. Maybe that’s what they were discussing—‘Thanks for the update,’ I overheard Mr Mugunga say. I hope he doesn’t get mad at me for eavesdropping. Even Jesus eavesdropped once or twice, didn’t he? And there is that fourth commandment.
Mr Ayota and I began searching for a quieter corner, far from the noisy group. I felt our conversation might get loud, and I wasn’t wrong. Mr Ayota isn’t exactly known for being soft-spoken. I’ve heard him talk before—he’s a great communicator, but his voice carries. Even Finance Minister Matia Kasaija mentioned at NSSF’s latest annual general meeting that he could easily excel in marketing and sales with his skill and he heard it.
Disappointed
We finally settle at a table by the corner, where the breeze adds to the ambiance, making us comfortable. We sit there for a moment, puzzled. 'Where do we even start?' I ask, and we both exchange grins. “Honestly, that story was unfair,” he begins, diving straight in.
Monitor had just published an article comparing the NSSF’s net returns with bonds, real estate, forex, and stocks the day before. “You can’t do that. I even asked Johnson Omollo, ABUL’s general manager, the entity that takes on NTV and Spark TV] what went wrong. Look, I know we’re not perfect, but it’s not fair. You’re comparing individual assets with a pool of assets. How does that make sense?” he says, frustration evident in his voice. I jump in, explaining that the intent was to show what someone might earn if they had the choice of where to invest their money, given the interest rate NSSF paid out. But he still looked disappointed, and I could see it on his face. And honestly, he had a point.
Just then, the waitress arrives, and I order an iced coffee plus muffins with chocolate chips. “I’ll have the same,” he says, looking resigned. We’re at Java House, Lugogo, the spot he chose a day before.No surprise—two people inside are clearly his colleagues. The place is nice though, cool ambiance, modern aesthetics, vibrant graffiti, and flowers that soften the vibe. Plus, the waiters are on point.
So, I started inquiring about a complaint one of his savers posted during the institution’s annual general meeting in which he was expressing anguish that NSSF only offers near benefits to those with HIV infections in case of emergencies.
Mr Ayota chips in with a quick denial, saying the Fund has a benefit called ‘invalidity’ which applies to somebody who is no longer able to work. The Fund itself doesn’t determine but a panel of doctors where people are referred to because of their medical incapacity to determine one’s sickness or vulnerability. “So it’s not limited to HIV patients only. What happened back then is that when you had HIV, people presumed it was a death sentence. But we have advanced to know that it’s not. Same with how Covid was.
Later, we realised it’s not that way, we moved on from that,” he says.
In good healthThis is an institution managing more than Shs22 trillion in assets, with Shs2.5 trillion in income recorded in the last financial year. That alone is impressive because there’s no other institution in Uganda with such a massive asset base dedicated solely to investing for returns.
Take MTN, arguably the largest company in the country with open books, boasting Shs4.7 trillion in assets thanks to mobile money.
Even Stanbic Holdings, which bundles the bank, unit trust, FlexiPay, and Stanbic Properties Limited, has Shs9.7 trillion in assets—making it one of the biggest holding companies in Uganda.
With these comparisons in mind, I got curious about the health of the NSSF, especially given the history of large pension funds that have collapsed or faced insolvency, like the United Airlines Pension Fund (2005), Detroit’s Municipal Pension Fund (2013), and the British Home Stores (BHS) Pension Fund (2016). Even with massive assets, funds can fail for a variety of reasons.
Mr Ayota reassures me that the Fund is in good health, and he’s got the facts to back it up. He points to three key public statements that demonstrate this—the balance sheet, which lists assets and liabilities, with claims and accounts payable laid out, the income statement and the cash flow statement.
“Our assets are liquid and have been consistently growing over the last five years. That alone speaks to the Fund’s health. When we declare interest, we move those funds from the income statement to the balance sheet. But the money stays within the Fund,” he explains.
Just then, the waitress arrives with my order. I ordered first.
Talking interest
During a brief pause, I decide to ask a question that I know might make him uncomfortable—the one about how people who start saving in August don’t earn interest right away. Anyone who joins the Fund after July has to wait until the following year to be considered for any interest. At the NSSF conference, two weeks ago, Mr Ayota was asked a question by a journalist—something that seemed trivial but was important—about how long the money waits before it’s invested. Mr Ayota had confidently responded that the money was invested immediately.
So, I prepare my argument carefully and put it to him directly, eye to eye. People have been quietly complaining about this for a while, and now I have the chance to get to the bottom of it.
Just as I finish speaking, the waitress arrives with his order. He takes a sip of his cold coffee, and I’m eager to hear how he’ll respond, especially given that unit trusts, which offer similar returns, pay their savers interest almost immediately. “You’re right,” he begins. “We paid interest to those who had balances by July 2023. If you brought your money in August 2023, that money didn’t receive any interest. It seems unfair, but that’s the law—the very law written by the government. We are simply following it. There was a rationale behind it. First of all...” he pauses, and I stir the cubes in my glass, ready to listen. “This issue of interest, the government took care of it. How? You contribute five percent, and what does the government do? It mandates your employer to add 10 percent.
So, on August 1, when you deposit Shs1,000, your employer is required to put in Shs2,000. Do you understand the magnitude of that return? That’s a 200 percent return on day one,” he explains.
I have to admit, his explanation makes sense. He continues, reinforcing his point, and I’m beginning to see his logic. “By doing that, the government has effectively addressed the interest issue. Now, it’s our job to invest that money safely. That’s why there’s a guaranteed minimum return of 2.5 percent, even in the worst-case scenario, to ensure we invest conservatively and avoid recklessness in distributing returns. The key attribute you want in a pension fund is the safety of people’s savings,” he says.
Prioritising safety
Mr Ayota tells me this principle is common in many Commonwealth countries, where employers are required to contribute, and pension funds are tasked with prioritising safety over high returns.
“What people tend to forget,” he adds, “is that they only focus on the declared interest. But the same law that governs how we declare that interest also forces the employer to contribute from day one, providing you with an immediate return.
For those who think they could do better elsewhere, remember this: if you have Shs10,000, that’s all you take to a unit trust. But with NSSF, your employer adds Shs20,000 for you. Completely different situations, right? Under those circumstances, what would you choose?” he asks with a grin, and we both laugh.
But he also acknowledges, with a sense of empathy, that there are things the NSSF would like to do but simply cannot—like offering payouts to members who lose their jobs long before they turn 50. “Sometimes it disadvantages the member,” he admits, “because the law is clear: 50 years is the threshold, and there's no legal room for interpretation.”
“These laws are passed by Parliament. If you want changes, talk to your Members of Parliament to propose them to the August House. As a Fund, what should reassure our members is that we strictly follow the law. We don’t operate outside its bounds. The day we decide to cross that line, we lose your trust, and that’s the very foundation of our relationship with you,” he emphasises.