AGENCY BANKING AND THE QUEST FOR FINANCIAL DEEPENING

A very quick measure of an economy’s dynamism is the amount of money in circulation -- money in our hands, pockets and under our mattresses versus the total amount of money including that being held in the banks.

The less the money in circulation compared to the money in banks, the better for an economy. Banks play an intermediary between those with the money and those who need the money. Money in your pockets is not helping you or anyone else, its just seating there. But you shift that money in to an account and the bank can on lend it to someone who needs it to consume or produce.

"The trick is to create a mechanism to liberate people from their cash and pool it in a place that those in need can have access to it. The more efficiently society can do this the better for the economy...

On Monday last week the Ugandan Bankers Association (UBA), the Agency Banking Company (ABC) and German aid agency, GIZ hosted an event to assess the rollout and impact of agency banking in northern Uganda over the last five years.

Five years ago Bank of Uganda opened the doors to agent bankers, who collect deposits, effect withdrawals among other financial services for their clients.

The rationale was simple. Since it costs too much -- $300,000, by some estimates to open a bank branch, why not coopt the business community in providing banking services.

This had the effect of increasing the banks’ reach into our communities and easing the pressure on their banking halls.

Similar was found in northern Uganda though not at the scale we see in Kampala.

Since the central bank’s approval of agency banking UBA and its partners have been working to popularise this mode of financial services in northern Uganda.

Ravage by war during 1990s and early 2000s northern Uganda proved a challenge for banks to spread their branches. With little urbanization and populations spread far and wide across the region the traditional model of bank branches would be a hard sell or at least would take longer than desirable to make a traction.

The study showed that the number of agencies or distribution points increased to 692  by end of 2022 from nothing five years prior. This reduced average distance from user to agent to 1.8 km from 6.8km increasing the value of transactions during the period by 18 percent. As a result, just under a thousand jobs were created directly by the agent banks.

The numbers may be a bit underwhelming, understandable coming from a low base, but the researchers also pointed out that agency banking found better traction in the region’s urban rather than rural areas.

 A raft of recommendations were made among which were that agent banking should be further promoted in the region through sensitisation of agents and the users,  reduction of initial cost of investment for agents and organize the agents into associations with a view to improving the business model.

Invariably the model will be greatly helped by improvements in telecommunications technology and the uptake of these technologies by more people.

"The ground has been set and its possible the north will leap frog the rest of the country in adopting agency banking and therefore getting financial services to more people than the rest of us who were hung up on branch networks. From there it will be a small step to adopting fintech....

Returning to the earlier explanation about money being more useful in banks than in pour pockets, believe it or not there was a time our salaries were paid to us in cash. God forbid you were paid on a Friday.

Today they post salaries to your account. If you don’t drain your account immediately someone will use your money to consume or produce.

And this is more important than we appreciate. According to central bank figures more than half the local currency in circulation is in our hands – sh14trillion of sh24trillion in February 2022, the most recent figures available. In more advanced economies this figure is much lower at under 10 percent. That makes a world of difference.

"It suggests that money is transmitted more efficiently from those who have to those who need it and has a huge bearing on the cost of borrowing. Banks make their money mostly through lending, if their cash holding increase they will be under pressure to get it out of the door quicker and hence a lowering of lending rates...

The rise of mobile money can only be a boon for agency banking as it will quicken transactions and widen access.

Its still early days for agency banking in Uganda, but the initial signs are very promising.

 

KIIRA-NALUBAALE MAYBE UEGCL’S POISONED CHALICE

At the beginning of this week South African power company, Eskom ceremonially handed over the Kiira-Nalubaale dams, they have been running for the last 20 years, back to Uganda.

And on Saturday, a day after the concession is over, they will officially hand over the 380 MW plant to Uganda Electricity Generation Company Ltd (UEGCL).

At the beginning of the 2000s the Uganda Electricity Board (UEB) was broken up into it constituent parts of generation (UEGCL), transmission (UETCL) and distribution (UEDCL). In addition, a regulator, Electricity Regulatory Authority (ERA) was created to oversee the sector.

The idea was that more investment could be attracted into the sector and  we would benefit from the specialization that would come with one operator focusing on distribution or generation. A consortium of investors and operators won the deal to distribute power and formed UMEME Ltd while several private operators set up generation plants. UETCL remained operated by government.

"A dark cloud hung over what would have been a joyous occasion at the hand over of the plant, because as it turns out, UEGCL is inheriting a plant that is in urgent need of remedial work and the prospect of multimillion dollar rehabilitation of the Nalubaale dam, which will make 70 years in operation next year...

Immediately UEGCL will need at least $10m (sh37b) to make repairs, which are a result of a back log of maintenance works that have gone undone over the last few years.

A battery of issues await UEGCL’s takeover, which may lead to financial loss, danger to workers’ and the general public and reputational damage to UEGCL, if not handled promptly.

Eskom clearly did not look after the plant very well. More than half the rehabilitation work on the dam of $51m was done over the last five years, with the under investment in the plant falling to as little as  $91,174 in 2017.

As an indicator of how woefully inadequate these outlays were the World Bank has recommended that between 2.0 and 2.5 percent of the initial investment should go into equipment and civil works annually. Given that the Kiira dam cost us about $270m, annual maintenance costs should be at least $5.4m. Eskom averaged about $2.5m a year in maintenance costs, explaining the backlog of headache UEGCL is set to inherit.

"Eskom officials argue that they could not manage that level of investment because ERA set their tariff artificially low, from which they would have got funds to finance a higher commitment...

The Kiira-Nalubaale plant  have the lowest tariff at just over US 1 cent per unit of power of any  generator who sells to the grid. Other generators are earning at least US7cents. This is mainly because of the finance costs of the plant have long been recovered.

The ultra-low tariff from Kiira-Nalubaale has been convenient for ERA to keep the weighted average tariff low but if Eskom are to believed, has prevented them from investing properly on the plant.

It did not help too, that for years there have been questions about Eskom’s capability to execute the concession properly, its parent company having been rendered bankrupt in 2019.

The aforementioned should have a bearing on what government pay Eskom as compensation for the non-renewal of the concession, but will not as deficiencies in the original concession agreement means government cannot fine Eskom for these breaches of the concession agreement. Parliament is currently mulling over a government request to pay Eskom sh45b in compensation.

So UEGCL will have to shoulder these urgent remedial works, after they have seen Eskom out the door on Saturday.

"Clearly ERA will have to revise their thinking on suppressing the tariff, if UEGCL is to fund these remedial works and a long overdue refurbishment of the Nalubaale dam, which it is estimated will cost $150m....

Over the years UEGCL has been in running battles with ERA to allow them charge for depreciation of the plants and a small return on equity. Charging these would ensure that UEGCL would when need be have enough internal resources to rehabilitate and even develop new projects.

As it is the UEGCL will have to go bowl in hand to beg for fund from the finance ministry to pay for Nalubaale’s overhaul, totally unnecessary if the tariff had been adequate over the last 20 years.

Government currently strapped for cash may not be very accommodative of new charges on the consolidate fund, especially if it could have been avoided.

President Yoweri Museveni has made it a goal to bring generation tariffs down to the magic US5cents, but this has to be achieved within reason and be adequate enough to allow the sector stand on its own feet.

While talks to give UEGCL an adequate tariff that will allow them room to maneuver and guarantee the future sustainability of the sector, are in advanced stages, one cannot help but think that the Kiira-Nalubaale handover to UEGCL, which has been profitable for the first time over the last two years, may very well be a poisoned chalice.

 

UPE AND THE FLIGHT FROM POVERTY

Getting out of poverty follows a simple formula.

But first what is poverty? Poverty generally, is the inability to meet your basic needs. The opposite of which is being rich, where you can not only met your basic needs, but have surplus income that comes from your assets.

"The formula of getting out of poverty is to trade value for income and with that income create more value and therefore more income. A virtuous cycle. A simple formula but not easy to execute...

The trick is to have something – a good or service, of value to trade. It is possible to have value and fail to trade it, either because there is no market for it or that the market is not aware of your value, but that’s a discussion for another day.

At the heart of the challenge for most anti-poverty programs is how do you create value and then get it to market, and do this sustainably over time.

The reason you are poorer than the richest man in your town is because he knows something you don’t. What he knows that you don’t, makes him behave in a way that ensures he earns more than you.

So invariably creating value often comes with mindset change.

Last week the education ministry commemorated the 25 years of Universal Primary Education (UPE) program. What started off as a response to a campaign promise by presidential candidate Paul Ssemogerere in  1996, was a good idea that was long overdue. Since then primary enrollment has jumped to  about eight million today from two million in 1996 and seen literacy levels  almost double to 75 percent from 43 percent in 1986.

As suggested above education, which by definition entails a mindset change and therefore creation of value, is a useful first step to lift people out of poverty.

There are questions about the content of our education system, but if one is literate can overcome these shortcomings with continuous learning.

It should come as no surprise that Kenya and Tanzania, which in the case of the former has had bigger enrollments at primary school or in the case of the latter started UPE in 1977 are bigger economies than Uganda. Their literacy levels reflect the earlier adoption of UPE with Kenya at 82 percent and Tanzania 81 percent.

"The thing with such social engineering initiatives is that it takes time to see tangible results, which may discourage people with shorter electoral time spans. But the benefits are there, its just that they may just creep up on you.

What value can you put on being able to communicate in one language all around the country? How much easier is trade? How much easier is it to mobilise populations? How much market do you create when more of us are educated or at least literate?

It’s happening already. While ideally we should be communicating in an indigenous language other than English, you can now go anywhere in the country and manage just fine with English, as most people now have studied English to some basic level. Hopefully with the introduction of Kiswahili at primary school, in another 25 years we should more improved communication around the country.

That being said there is a lot to be done. The education ministry reports that there is no government aided school in 1,617 of the more than 10,000 parishes in the country.

The ministry estimates that it will need sh1.89trillion or about sh1.2b per school to bridge this gap. Apart from questions of value for money there really should not be any hesitation in releasing these funds.

The best investment a nation can make is to invest in its people, and providing education as well as health services should be key.

A country like Singapore with a tenth of our population and for all intents and purposes, a rock in the sea has a GDP of about $400b.  Beyond basic literacy Singapore’s education system is ranked in the top 20 in the world. It helps of course that there has been an education system in that country since 1823.

Coming full circle to poverty eradication, there are two ways that I know of for an individual to create value, either through education or experience.

UPE has its issues. The idea is sound but the execution may be wanting.

"A previous generation, which did the proverbial 10 mile trek to and from school, have countless stories about how education made a difference. In single families there are siblings who had climbed out of poverty and others who were wallowing in poverty, the difference being one sibling went to school and the other did not.

Interestingly they started their schooling writing in the dust using sharpened pieces of wood (we call them stylus these days), often under trees and many times there was no school when it rained.

They came out fine and many of them lead or have led this country.

 

 

 

 

MTN AND THE FUTURE OF THE ECONOMY

Last week telecom company MTN released its 2022 results.

Revenues, profit were up and for investors in the company they will be paying out their final dividend for the year, which will have seen shareholders pocket a total of sh15.9 per share for 2022.

Everybody has their favourite numbers, I am always interested to see how the data and fintech subscribers and revenues are moving, especially against voice numbers.

First of all in 2021, it was the first time, that revenues from voice – what we pay to call, fell below half the companies total revenues. While these grew by 3.6 percent, data and mobile money revenues grew in double digits upsetting the status quo.

"In 2022 data and fintech revenues continue to gallop ahead while voice revenues slipped 0.5 percent, the first time in the company’s history that voice revenues did not grow...

The writing is on the wall voice is out and data and fintech are in.

It reminds me of former Safaricom CEO Bobby Collymore’s prediction when he took over the reins at the Kenyan telecom firm, that one day voice will be an add on, given away for free, that the action will be in data and fintech services. I could not relate at the time but it is coming to pass every day.

When Airtel lists its shares – they were supposed to do so by July last year, we will be able to tell whether this is an industrywide trend or restricted to MTN. I bet it shows across the industry.

This is an important, even critical, to the development for the economy.

Beyond the ever-increasing access to information that come with improved and more widespread data services is the fact that credible business transactions can be done quickly and safely using data.

The spoken word has its limitations. Information transmitted via this medium – unless recorded, can be dismissed or refuted in the future. The written word is more easily verifiable, hence the need for written contracts.

While its possible that most of our data is consumed by entertainment, it just as likely that its use in business is expanding.

"The efficiencies to the whole economy will creep up on us, because it is easy to take these new services for granted, but let us look back to an earlier time.

There was a time when there when we did not have mobile phones ( for those born after 2000, just believe it) and the country was good for about 50,000 landlines, many of which were down anyway.

So things we take for granted now like making and confirming appointments, deliveries, calling a cab these were all none existent activities. How did we go about these things? We did not. Booking appointments was done in person or by mail (if you had a post office box), deliveries? How! And you walked to where the special hires (do you remember those guys) to get a ride. The explosion in boda-bodas has been largely facilitated by the mobile phone. There were no bodas, expect maybe at the border.

Efficiency is the ability to do more work per unit of input. The input may be time or money or effort. So we are now doing more work than we used to because we can communicate better.

Taken to the next logical conclusion is the rise of mobile money or fintech as a sector. The efficiencies here are obvious ( at least to me). To give my friend or relatives money I had to meet them in person, send someone with their money or they send someone to pick the money Now for the cost of less than a return taxi fare I can move money around at the speed of light and the other minutes, which would have been spent going to and fro can be used for something else.

Some stoneagers would rather stand in line at the bank to pay their bills than pay the transaction fees charged when they pay online. They cannot be helped.

And these our most basic transactions in a day scale it up now to companies, schools and traders and the numbers begin to bogle.

In June last year it was reported that the total number of mobile money transaction stood at sh145trillion in the first six month so last year. To put this in perspective the national budget was about sh48trillion for the whole of 2021/22.

"By definition when money moves it moves to where is needed from where it less needed, broadly speaking. These trillions of monies a large part of it, was probably doing nothing under our mattress, in our socks and bras. It has taken mobile money companies to liberate them from those dark, smelly corners into the light of day...

MTN reported that last year fintech users grew about ten percent to 11 million users. Assuming they show the same rate of growth (my feeling is it will actually accelerate) we will be doubling mobile money users ever seven years. What seemed like a pipe dream a few years ago, becoming a cashless society,  is happening before our very own eyes.

The more of us who are signed on to mobile money and other fintech applications the faster transactions will be done in the economy. And if time is money it follows that the economy will be the better for it.

It probably explains why you can turn up at a bar on a Monday night in Kampala and it seems like the weekend – money is flowing more efficiently boosting consumption and inevitably production.

 

 

THE POWER OF COOPERATIVE SYNERGY

BOOK: MAKING COOPERATIVES WORK

AUTHOR: CHARLES KABUGA

I have long held the view that Uganda and Africa in general, is poor because of our inability, unwillingness or external schemes that prevent us from aggregating our resources be they land, capital or labour.

We try to got it alone as individuals, communities or countries preventing our ability to take advantage of economies of scale and the synergies that come with. I have seen synergy defined as one plus one equals 11 not two.

"The point is, when we come together we can unlock potential that is greater than the sum of our individual parts...

That is why I am a big fan of the cooperative movement and the book “Making cooperatives work: Optimizing development through social capital” by long time cooperator Charles Kabuga could not have come at a good time in the history of our country.

It is an opportune time because there is a rush to start savings & credit cooperatives (SACCOS) around the country, to take advantage of the Parish Development Model (PMD) funds. When the dust settles there will be a handful of cooperatives left standing, hundreds of others set up opportunistically will have fallen by the wayside. Which will be sad but inevitable.

Hopefully the failed SACCOS will not discourage people from staying the course and joining the more viable SACCOS.

In his book Kabuga does a commendable job of charting the history of the cooperative movement, internationally and in Uganda, outlining the theoretical framework on which they operate, the oftentimes uneasy relationship with state and what he sees as the future of the movement.

In Uganda the cooperative movement was severely weakened by the economic troubles of the 1970s and 1980s. Structural adjustment of our economy, which required a cut back on public expenditure, privatization and especially liberalization of commodity marketing dealt a near deathblow to the cooperatives.

He points out that cooperatives relied on the commodity marketing monopolies the government put in place and the cooperatives were the main suppliers to these marketing boards. When these were disbanded and private players begun exporting commodities, the cooperatives whose management failed to move with times found themselves adrift at sea with the inevitable collapse following soon after...

The closure of the Cooperative Bank in the late 1990s sounded the death knell for the cooperatives as we knew them at worst or forced a reset of how they had to operate in the future. Few cooperatives survived this carnage.

Kabuga has some time-tested advice on how sustainable cooperatives can be set up and some thoughtful ideas about how they may have survived the structural adjustment period.

I agree wholeheartedly with him that cooperatives need to make a deliberate decision to build their capital base. The practice now is that cooperatives tend to distribute a lot of their profit to the members annually. While this is good for morale and endears the leadership to the members it counterproductive in the long term. Weak capital bases is a major reasons why the cooperative movement failed to overcome recent economic upheavals.

That being said the relevance and the importance of the cooperative movement is needed now more than ever before.

Despite decades of economic growth the wealth inequalities are widening and the cooperatives Kabuga maintains may be just the mechanism needed to help bridge or at least slow the rate of inequality.

The beauty of the cooperatives is that they do not need any one’s permission to begin. While to legally operate in the country one needs to register with the trade and cooperatives ministry, the will to cooperate has to be self-generated. This is an important point because cooperatives are not about positioning for handouts but a tool for building self-reliance in our communities, leveraging the power of numbers to advance society.

"For those with cold war hangovers he says cooperatives are not a socialist tool. That in fact there are cooperatives even in the most capitalist of societies albeit going by different description....

The book is potentially a powerful reference for the industry a critical resource in a world where the reality is settling in that we are going to have to develop ourselves and not rely on foreigners with  alternative agendas that do not necessarily rhyme with ours.

It is written in very accessible language and is must read for any leader political or otherwise who has a genuine desire to uplift his people.

 

OF NSSF, BONUSES AND DUBAI HOLIDAYS

The NSSF parliamentary probe is done and dusted. Parliament upheld the report’s recommendations, which among other things called for the resignation of the minister, scrapping of the board and the suspension of management.

"The report – a 562 page tome, is an amazing (I am trying to be polite) piece of work. If it was supposed to unearth impropriety of the management, it failed dismally and instead started clutching at straws. Parliament conducted a fishing expedition that came up short but decided to make drastic recommendations that made for sensational headlines but little much else....

The net effect is that they so muddied the waters, that it is inconceivable how gender minster Betty Among can continue to work with the board or management. Though to be fair, the relationship was already toxic and the committee only served to bring it into the public glare.

One thing that has become apparent to me is that NSSF has become too big for us. The magnitudes of money being delt with in NSSF we clearly do not have the band width to comprehend.

Two incidents come to mind.

In the report the committee was alarmed at sh33.3b bonus payment to staff and aghast at how 85 staff went to Dubai for a team building exercise that cost sh200m. In respect of this the committee said, “That the board should be cognizant of their core responsibility, which is to ensure a secure, profitable and effective financial management for the benefit of the workers …. Desist from such unnecessary expenditure, which will occasion loss to savers’ Fund.”

I would like to think that the motivation of NSSF staff in principle is a good thing. And I would like to think as well this motivation has to have a monetary value.

The trick with designing worker incentives is to link them to performance, in this case improved return for the members. Ideally if the enterprise does better than the previous year your bonus should be better, if you don’t it will be less. And the bonus should be a proportion of the improvement in performance. That sounds like a good enough principle.

So if for example you work for the Vision Group, which last year managed a billion shilling profit and say worker bonuses are set at five percent of profit, then we would share sh50m according to a predetermined formula.

Using that logic NSSF made surplus of sh1.26trillion in 2021/22 assuming like the example above worker bonuses were five percent of profit, then NSSF workers would be sharing sh63b among themselves.

What does sh63b look like?

For one it is more than half the Vision Group’s total revenue of sh100b in 2021/22. So, the knee jerk reaction at the Vision Group maybe “Shaaa! How can they get all that money as bonus?” But that would be us at Vision Group thinking from our small perspective.

In short NSSF has become too big for us. It has become so big that when we view its numbers against our smaller puny reality we think they must be up to something fishy.

Just to remind you NSSF has almost sh18trillion in assets under management. To stay with the Vision Group as an example, which has sh122b in assets, NSSF is nearly 150-times bigger than Vision Group. Basic logic would dictate that everything – wage bill, profitability, bonuses would reflect this reality. This is not the fault of the NSSF workers; Ok maybe to the extent that they worked to make these numbers happen and should therefore should be renumerated accordingly. You have a problem with that apply for a job at NSSF.

"Incentivising workers is a normal cost of business. The slave trade ended in the 19^th century. The MPs should have put aside their shock at the “huge” bonus, asked how it was derived and maybe suggest a change in the formula to fit their perspective, which would be unfair to NSSF workers....

And then my pet peeve is the cost of houses at Lubowa. To their credit the committee restricted themselves to recommending a value for money audit of the project. But minister Amongi on the floor of parliament in her defence brought it up.

She outlined the cost of a three-, four- and five-bedroom bungalow and asked the house gleefully how a house can cost sh3.2b. She clearly couldn’t wrap her head around the concept. The speaker Anita Among asked her whether she had alternative prices for the same properties and the minster had no clue. Someone helped her with a note, which showed that comparable properties at the Royal Palm Estate in Butabika were better priced – though they too are outside the range of the majority of NSSF members.

There are many things that can be faulted with this comparison not least of all that the locations are different – have you driven on the Port Bell road lately; that  Royal Palm was launched 12 years ago – have you tried buying a bag of cement today, you can tick off the differences. 

Somehow the committee queried the unit price of the houses, the total scope – 2,417 units and cost -- $400m (Sh1.5trillion) was probably too much for them to handle.

In hindsight maybe NSSF should have anticipated this need for cheap houses and built the ugly lifeless high rise apartment blocks, which we see in western capitals, which would have increased the number of units and maybe brought unit costs down.

NSSF however decided to build high end properties on the prime Lubowa land and the more affordable housing, which will complain are still too expensive in Temangalo and eventually Nsimbe estate.

MPs may want to use the opportunity to lower the cost of mortgages – now not below 10 percent anywhere, lower the cost of development – infrastructure takes up at least 30 percent of the price and urge government to underwrite the infrastructure costs of such massive projects, all within their power to do.

"The truth is we need to upgrade our reality to manage NSSF. And this is a serious issue we have to address ourselves to. NSSF is a modern institution in a pre-industrial country. Either we cut it down to size, since it has galloped far ahead of our reality or we elevate ourselves to appreciate not only what it has become but the Fund’s strategic vision as well to better oversee it well into the future....

I say this on the assumption that our motives are noble and their no ulterior agendas at play.

DO NOT THROW OUT THE BABY WITH THE BATH WATER

I am not a big fan of parliamentary probes. They tend to be high on drama and low on substance.

Last week's parliamentary report on the National Social Security Fund (NSSF) probe did not disappoint in this regard.

The probe which took two weeks in February, was called in response to gender minister Betty Amongi's allegations of mismanagement at the fund that were preventing her from renewing former managing director Richard Byarugaba's contract.

The probe hearings served up a lot of sensation and ended up besmirching the reputations of the minister, board and management. Given the tone of the probe its recommendations for minister Amongi to resign, scrapping of the board and suspension of the entire management should not have come as a surprise.

Its former US President Barack Obama who said that democracy is messy. And in the exercise of that messiness a lot of good can get thrown out with the bath water.

"When you strip away all the dazzle and razzmatazz I came away feeling that the good performance of the NSSF management over the last decade was overshadowed and unfairly so by what I thought were some administrative lapses...

These lapses while quite shocking were often seen out of context and blown out of proportion.

First of all the fund has shown consistent growth since 2011 growing to sh17.5trillion last year from sh1.7trillion. A tenfold growth that has been independently verified and speaks to the progress the management has made for its members.

And while it is true that some investments have not shown much growth during the period, it is unrealistic to expect uniform growth in a basket of assets and to pick certain parts of the portfolio, which are under performing to damn the entire portfolio.

In fact, to objectively judge the Fund one should look at their 10 year strategic plan that was drawn up in 2015 and expected to expire in 2025.

In this plan they had set a target of growing the fund to sh20trillion,  a target they seem to likely to achieve ahead of target; to improve customer satisfaction to 95 percent, a figure which stands at 83 percent today; growing staff satisfaction to 95 percent by 2025, which is currently at 92 percent and finally to reduce turnaround time for processing of benefits to one day from the average of 26 days in 2015. Today this figure stands at nine days.

"This progress shared publicly with the members annually, suggest that more has gone right than wrong at the Fund. To lose sight of this would be to unfair to the management and demotivating for future leaders of the Fund....

One issue that was particularly unfair was the committee's criticism of the sh16b and sh17b bonuses paid to staff in 2021 and 2022 as excessive and uncalled for.

In any other organisation in this country those figures would seem outlandish, but in both cases this was in recognition of the funds creation of sh2.3trillion and sh1.7trillion in additional value. Simple arithmetic would show this was one percent or less of the value created and well with in a realistic range.

The number looks big if not viewed in its proper context.

The parliamentary probe was a good one to the extent that it gave everybody a hearing, the challenge was the conclusions it arrived at, which painted the management and staff in a less than fair light.

I know that the attraction to control or at least influence the goings on at the sh17trillion Fund can be hard to resist for even the most upright saints. But we need to recognise that the Fund is on a positive trajectory and it  should be helped to maintain this for the benefit of its members and the economy as a whole.

I have been a member of the Fund since my first paycheck in December 1995, I have an obvious bias to see NSSF continue progressing in its positive direction for at least the next five years. Beyond my own selfish needs it will do me good if it continues being profitably run well into the future so my sons and their children after them can benefit.

"This has been the longest stretch of good performance of the Fund in living memory and  compares favourably with other funds in the region....

The Kenya's NSSF, which has been in existence longer than our own, lags behind our Fund in performance. By one measure, their assets have grown an average of eight percent annually over the last five years compared to 17 percent per year for our NSSF. And  this despite our Fund being bigger than theirs.

As we go into the debate of the report by the whole house of parliament, we  would do well to keep this perspective in mind.

Again to paint this period black would be a great disservice to the management and the future prospects of the Fund and if the house cares anything about the members of NSSF they will do well to keep this in mind.