Workers fault Rwanda pension body for bad investments

Sunday February 12 2017

Vision City estate is one of Rwanda Social Security Board’s major investment in the country. PHOTO | CYRIL NDEGEYA

Vision City estate is one of Rwanda Social Security Board’s major investment in the country. PHOTO | CYRIL NDEGEYA 

By Moses K Gahigi

The Rwanda Social Security Board will have to dig deeper and find a lasting solution to the pension problem, as pensioners continue to complain about the paltry benefits, which they say cannot meet their basic needs.

The pensioners say RSSB has not addressed their concerns, but continues to spend their money in a wasteful manner, especially in loss-making ventures.

“The pensioners’ situation is appalling because many of the beneficiaries cannot even meet their basic needs,” said Eric Nzabandora, the president of COTRAF, a syndicate of workers’ trade unions.

He said recent research by COTRAF showed that people earn as low as Rwf5,000 per month, and according to contributions, urban pensioners should earn a minimum of Rwf78,000 per month and maximum of Rwf126,000.

“There are serious welfare issues because some of them do not even get the Rwf5,000 on time, yet they have families they are supporting,” said Mr Nzabandora.

He faulted the government for not objectively monitoring and following up on issues affecting pensioners.

“Government looks at the whole citizenry; there are gaps in the way this money trickles down to the beneficiaries” he noted.

The auditor-general in his annual reports, has on several occasions come out strongly against RSSB, accusing the body of investing pensioners’ money in ventures that have not generated any returns.

RSSB recently came under fire for building mega structures in rural areas — which made it difficult to get tenants — after which they hired CVLD to manage and rent out the properties.

Pensioners fault the body for haphazardly investing their money in loss-making enterprises, thus reducing the money they should be paid.

The report says 16 equity investments that cost the body Rwf65 billion, did not earn RSSB a cent in the year ended June 30, 2015, but the pension body still injected Rwf16 billion more to three of the investments in question.

RSSB officials have defended the body, saying running a Rwf500 billion portfolio is not easy and is susceptible to administrative errors and inaccuracies.

“Going into retirement is the worst thing that can happen to you, I have been retired for a few years now, but it’s horrible, no one seems to care for you, and you hear of RSSB events, but nothing changes,” said a pensioner who asked for anonymity.

RSSB is yet to respond to this newspaper’s inquiries on these issues, despite reaching out to them. However, in a recent interview, Moses Kazoora, who is in charge of public relations at RSSB, said they had made recommendations related to pensioners concerns to the line ministry but they were yet to get a response.

When Rwanda Today asked Judith Uwizeye, the Minister of Public Service and Labour if these issues had been referred to the ministry and what is being done, she said a study is being carried out.

“We all agree that there is a need to revise these benefits and we have held several meetings about this issue,” she said.

Pensioners have also raised an issue with the decision to raise the retirement age from 55 to 60 years, saying the change is unfair and only favoured pension collectors and not workers.

They claimed that the nature of their work affected their longevity and suggested the retirement age should be revised downwards.

Many pensioners are said to die shortly after retirement because they are stressed and needy, and many liken it to death.

An official from RSSB recently confirmed to this paper that they are working on a plan to acquire a stake in the country’s oldest insurer, although no details were given. Industry sources say that RSSB could become the majority shareholder in the embattled insurance company.