Kampala, Uganda | THE INDEPENDENT | The National Social Security Fund-NSSF has invited local suppliers to take up opportunities worth 826 Billion Shillings that it plans to spend on procurement for products and services in the year 2021/2022 financial year.
The planned projects include real estate, which will take 779 billion Shillings. This will involve construction of low-cost housing units in different areas, while IT and Computer procurement will take 40 Billion Shillings.
Other products to be procured include motor vehicles, which are expected to cost 7 Billion Shillings while office equipment and furniture and fittings will take 1 billion and 0.5 billion Shillings respectively.
The Fund hopes that this investment will help them achieve the objectives of the five-year strategy which includes growing the size of the fund to 20 Trillion Shillings by 2025.
Currently, it is estimated at 14 trillion.
The strategy also sets to ensure that savers get their benefits within a day of filling for the application for the payment.
NSSF Managing Director, Richard Byarugaba said their intention is not to get one-off suppliers, but suppliers who will be taken up as long-term partners, to be part of the road to achieving the strategy.
At least 55% of Uganda’s budget is spent on public procurement but an estimated 10% -25% is lost as a result of inefficiency and corruption, according to Byarugaba.
Most of the physical investment by NSSF is in the real estate sector and Byarugaba says the fund wants the suppliers to provide technology that will lower the cost of construction to that they become cheaper and more affordable to members.
This, he says will also enable them to continue investing in the real estate sector without the investments affecting the liquidity of the fund.
The strategy also seeks to see at least 95% of the customers satisfied by the service the Fund offers.
Byarugabaa also hopes that President Museveni signs the NSSF Amendment Act as soon as possible because it will help them achieve some of their aspirations including registering 20 million members and expanding their investment portfolio.
Gerald Mugabi, the head of procurement at NSSF urged those intending to supply the fund and others who may not be interested, to adopt technology systems as the driver of the business, saying suppliers who remain analogue cannot do business with them.
He says they have put in place measures to ensure local contractors take up as much as possible especially for contracts that are valued below10 billion Shillings while for the large contracts, foreign firms subcontract local ones for at least 40% of the value.
Professor Augustus Niwagaba rapped commercial banks for stifling growth of enterprises by maintaining high lending rates despite the Bank of Uganda reducing the Central Bank Rate to 7%.
Banks in Uganda lend at an average 18% today, with most of the money lent out from the deposits of the customers, which Niwagaba says makes it cheap for the banks.
He hails the Kenya policy where the government capped interest rates at 14%, adding that that is why Ugandan companies cannot compete with international ones which get cheap capital from their home financial markets.
Prof Niwagaba also attributed the low industrialization of Uganda to the lack of trust of Ugandans and the high levels of corruption, adding that the reason why real sector is expanding is because it does not give much room for embezzling the investor’s money.
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