The Public Social Security Service Fund (PSSSF) of Tanzania has set an ambitious goal of increasing its pension fund value from the current 8.07 trillion Tanzanian shillings to approximately 10 trillion Tanzanian shillings. This move aligns with the objectives outlined in the second corporate plan, which spans from 2022/2023 to 2026/2027.
Mr. Hosea Kashimba, the Director General of PSSSF, revealed this significant aspiration during a meeting with members of the Tanzania Editors Forum (TEF) in Dar es Salaam. He emphasized the impressive growth the pension fund has already experienced, with its value increasing by 27.76 percent from 5.83 trillion Tanzanian shillings in 2018 to 8.07 trillion Tanzanian shillings in 2023, averaging a 6.72 percent annual increase.
Mr. Kashimba outlined the key goals set forth in the five-year strategic plan, which includes improving customer service, ensuring financial stability, achieving excellence in performance, adhering to anti-corruption policies, and promoting disease prevention measures, including HIV/AIDS and non-communicable diseases.
He also highlighted the fund's successful efforts in paying claims, notably disbursing 1.03 trillion Tanzanian shillings to 10,273 members and dependents, who had long awaited their payments due to merged funds. These claims, initially payable within two years, have continued to be paid over a five-year period, with the fund disbursing a total of 8.88 trillion Tanzanian shillings to 262,095 beneficiaries as of June 2023.
PSSSF has also effectively managed and increased its investment portfolio, witnessing a growth from 6.40 trillion Tanzanian shillings to 7.92 trillion Tanzanian shillings by June 2023, representing a 23.5 percent increase and an average annual growth of four percent. This diversified investment portfolio includes government bonds (60 percent), investments in large buildings (15 percent), company shares (12 percent), fixed deposits (7 percent), and other areas (6 percent).
Furthermore, the fund has made substantial strides in cost management, reducing operating costs from an average of 12 percent to 5 percent of the contributions collected per year. This achievement is below the 10 percent limit set by the country's social security guidelines.
Mr. Kashimba highlighted the fund's success in attracting new members, with 140,162 individuals joining from various sectors, including health, education, and public institutions, with the government holding a 30 percent share.
In terms of pension payouts, PSSSF has significantly increased the amount disbursed to retirees, now paying an average of 67 billion Tanzanian shillings per month, marking a 100 percent increase compared to the 34 billion Tanzanian shillings paid at the fund's inception. Additionally, the fund has streamlined its processes, ensuring that benefits are paid within the legal requirement of 60 days, all while improving customer service through IT systems developed by local professionals.
Mr. Kashimba underscored the fund's commitment to compliance with government laws, procedures, and guidelines. Notably, PSSSF has received accolades from the National Board of Accountants and Auditors (NBAA) for its accurate calculations and exemplary record-keeping for two consecutive years, 2020/2021 and 2021/2022.
Among other notable achievements, the fund has disbursed over 35 billion Tanzanian shillings to 13,000 workers who were suspended from work due to fake certificates. This effort aligns with President Samia Suluhu Hassan's directive, with ongoing processes to ensure all eligible individuals receive their rightful payments.
Mr. Kashimba expressed gratitude to President Samia for her leadership in settling the 4.6 trillion Tanzanian shillings owed to members of the pre-1999 PSPF Fund. This decision has allowed the fund to recover 2.17 trillion Tanzanian shillings through special bonds. Additionally, the government has paid PSSSF 500 billion Tanzanian shillings out of 731.4 billion Tanzanian shillings, which represents loans for various projects, including the construction of the Parliament building, Hombolo Government College, Nelson Mandela Institute of Science and Technology, and the University of Dodoma, all of which contribute to the fund's investment portfolio.
In closing, Mr. Kashimba noted, "The issue of paying off the government’s debt in the fund, especially that of pre-1999 contributions, took a long time, almost 20 years; however, through the strong leadership of the Sixth Phase Government, this has been achieved."