For long, Ugandan executives have been looked down, and said of being inferior mortals without the faculties needed to run any business successfully. Fake statistics and comparative researches have been peddled of how ‘one person from a foreign land’ does work done by six Ugandans! Really!!
All this is changing thanks to the new breed of executives prepared to bring change. First was URA. The once axis of corruption and wastage of public resources, URA had gone to the dogs. Allen Kagina transformed the authority into one of the most tech-savvy and efficient government parastatal.
In the private sector, Stanbic bank, DFCU, Centenary bank continue to improve in all measures of growth and performance. Now Umeme is the new big test. Will he or will he not?
The story is not complete without mention of the NSSF transformation. After a series of scandals involving our very own, talk was rife that an expatriate comes in to help. Suffice to mention, past executives including majority of board members had significant exposure to politicians and indulgence by the legislators. A few changes in the appointments saw Hon Maria Kiwanuka become Finance Minister (she is a sober entrepreneur and business savvy), Ivan Kyayonka (RIP) as NSSF Board chairman (also very sober and focused executive) and Richard Byarugaba, the maverick CEO at the Fund.
This caliber of people, despite own weaknesses, provided strong leadership and support to help the CEO do his thing. And now we have a Fund worth its name.
Lots of improvements have taken place: cost to income ratio fell to 12 percent up from 15 percent; Fund’s monthly collections hit Ugx. 65bn and customer satisfaction now at 85 percent.
Gone are the days when a mention of National Social Security Fund (NSSF) brought thoughts of corruption and extravagance. Under David Jamwa, the Fund’s image was not only damaged but savers also lost billions of shillings in dubious deals and mismanagement.
At the time, corruption is said to have been hit the all-time high at the Fund. The news of Jamwa’s escapades in a Casino in Las Vegas USA where he is said to have spent about $8,271 within hours were the talk of the day. The Fund had turned into a brokerage house where billions of deals were made and the money used to acquire real estate thereby distorting the market. According to a forensic investigation by KPMG, Jamwa is said to have among others sold off (retired) the Fund’s bonds before maturity thereby occasioning loss of Ugx. 8b to NSSF savers in just two days. Similar suspicious transactions are said to have caused additional loss of over US $3b.
The Fund has undergone commendable transformation, with overall positive impact on the interest payable to savers increasing to 11.5 percent from 2.5 percent.
The fund undertook a restructuring exercise, including activity analysis and staff rationalization to identify and remove unnecessary activities – those that do not add value to the customers – and the corresponding head count.
The ability to keep operating costs below the belt is critical to the success of institutions. The fund has been chocking with high operating costs, with cost to income ratio hitting 55. 2 percent in 2009, and then 36.5 percent in 2011. Before dropping from 16.3 percent in 2012 to 15 percent in 2013.
The Fund is reported to have reduced vehicles from 100 to 40, thereby saving servicing and fueling 60 vehicles costs. Most of government vehicles are used to run private errands like visiting their relatives’ up-country, carrying charcoal, and running private businesses.
Staff were reduced from 800 to 400. The problem with most government institutions is they recruit not to fill a position but to help their relatives, friends and friend’s relatives- it starts as an intern, then a full-time job. NSSF is said to have had people whose roles where to pick and drop cheques in the bank, read newspapers and sit in offices waiting for work! That is why in the 2015 budget, government wage bill is Ugx. 3 trillion – lots of this is for per diems on travels abroad. Imagine the wastage.