In a bid to sustain the sector growth, the regulator enhanced its risk-based supervision framework to support the authority’s supervisory business operations, according to Daisy Nabakooza, the acting director in charge of supervision.
Nabakooza said this approach would heavily rely on digital tools to monitor and supervise the management and control of the schemes under URBRA’s hand.
She said the approach would also focus on how schemes are investing members’ savings, the expenditure, risks involved and levels of funding and more.
In addition, Nsubuga and Nabakooza said the regulator developed a trustee certification program aimed at driving up standards of trusteeship, embarked on the implementation of its strategy to extend coverage to informal sector workers, and provided policy advice to government and private entities on proposed sector reforms.
According to the duo, these interventions are meant to establish a credible retirement benefits sector that will increase coverage and grow workers’ assets as they build up over their work life, and ensure reliable flows of retirement consumption.
URBRA officials said all schemes will experience supervisory oversight at ever increasing levels of intensity, depending on the risk they pose.
Management will therefore ensure that all sector services and products demonstrate and deliver the best possible outcome for members.
During the year, the ministry of public service working together with the first parliamentary counsel finalised the draft Public Service Pension Fund Bill, 2020.
This development emanates from the 2018 cabinet approval of the principles for reforming the PSPS from the current unfunded, non-contributory, PAYGO scheme into a fully funded and contributory Defined Benefit (DB) pension scheme, and directing of the ministry of public service to issue drafting instructions to the first parliamentary counsel for the Public Service Pension Fund Bill. The bill seeks to address issues of affordability and long-term sustainability of the scheme given its current operation as an unfunded defined benefit scheme.
The proposed PSP Fund Bill once passed will make the scheme contributory where government and public servants make contributions, enable accumulation of assets which will facilitate timely payment of benefits. This Fund is expected to be operational in July next year.
The other development had to do with the NSSF (Amendment) Bill, 2019 which seeks to introduce changes to the NSSF Act, Cap 222 that was enacted in 1985. Stakeholder consultations on the bill and its constituent sections is currently ongoing. It seeks to among others empower the fund to expand coverage by making membership to the fund mandatory for all formal sector employers, permit those employed in both the formal and informal sectors to make voluntary contributions to the fund, provide for introduction of new benefits, and improve governance.
Pension sector pundits including Fred Muhumuza, an economist told The Independent that the new sector developments penned during 2019 and those planned, gives the regulator more work.
“…it will have to build more capacity in all departments to be able to stir sector growth,” he said.
Muhumuza also said that URBRA needs to do a lot more on educating the public about how its regulatory work impact growth of the sector and why saving is important for retirement. He said the education programme could be done through partnerships with sector players.
Muhumuza added that the growth of the sector in years to come will depend on how serious URBRA is when it comes to monitoring and supervision of retirement benefits schemes under its docket.