Ensure PSSSF investments are safe for pensioners’ funds

It is unclear whether the MPs, as peoples’ representatives, had Pensioners’ interests at heart. PSSSF is the custodian of pensioners’ money, the latter to be invested prudently to ensure high returns so that pensioners can get their benefits without hassle.

In March 2024, the Permanent Parliamentary Committee on Public Investments (PIC) expressed their satisfaction with the investment in the PSSSF Commercial Complex building located on Sam Nujoma Road in Dar es Salaam. 

The modern 35-story building, worthy 232 billion Tanzania shillings is owned by the Public Service Social Security Fund (PSSSF) and was then reported as being 100 percent complete and operational. Giving a profile of that building at that occasion, the director general of PSSSF said the PSSSF Commercial Complex is the tallest building and one of the landmarks of Dar es Salaam. It is also the tallest building in East and Southern Africa.

He pointed out that the building has three towers: one is the Commercial Complex, which is the tallest with 35 floors, the Executive Tower with 14 floors, and a 6-floor parking area. The Executive tower is specifically for office activities, the commercial complex involves banks, mixed offices, conference halls, and other social activities, and then there is the parking area. Recently the Parliamentary Social Welfare and Community Development Committee visited and congratulated PSSSF for its success in attracting large corporate tenants to its PSSSF Sam Nujoma Complex. The property however, is yet to be fully let.

In the Kilimanjaro leather factory case, we see the MPs urging PSSSF to urgently complete the leather factory. This means investing billions of shillings of pensioners’ money. PSSSF’s expectations are that after 10 years, the factory will have recovered the total invested capital of over Sh150 billion.

However, we know of a number of formerly publicly owned leather factories which went bankrupt. The public sector may not be that good at running commercial enterprises, especially manufacturing industries.

In the latter case we see MPs expressing satisfaction with PSSSF’s investment in the Sam Nujoma Complex.

The CAG, however, had, in one of his past reports, expressed concern that pensioners’ money was being invested in real estate projects that may not yield the required returns given the cost incurred, the running costs and the market conditions.

In the both the above cases, and in pensioners’ funds investment in general, how involved are the Fund owners, the pensioners, in decisions that are made to invest their money? The fact that they are pensioners does not mean that they have lost capacity to advise on investments that are in their own interests. After all, it is their money, and their future which is at stake.

For sure Pension Fund managers are trusted to act in the best interests of their clients. But there are past reports that have implied the dark side of investments that were possibly ill-advised.

Hon MPs should also cast an inquisitive eye and show that they just do not have projects’ interests at heart, but they also consider the future welfare of pensioners. The fact that an investment glitters or has a well-written profile does not mean that it is viable especially in the long-run.

The Hon MPs, whether acting from Committee membership, or from their position as peoples’ representatives, should be aware that they represent pensioners as well. If money is not well invested, pensioners are sure to suffer.

This is also to further urge that the setup of pension funds should have active representation from the pensioners themselves, so that they too own the projects, and are not just on-lookers.