Members of Parliament on the Committee of Commissions, Statutory Authorities and State Enterprises (COSASE) have questioned the National Social Security Fund’s (NSSF) investment of approximately Shs165 billion in Marriott Hotel, in which the fund holds a 30 per cent stake.
The legislators expressed concern over the amount invested, arguing that it was excessive for a minority shareholding and demanding an explanation of the expected returns on the investment.
While interfacing with NSSF officials, the committee, chaired by Nakawa West MP Muwada Nkunyingi, tasked the fund’s Managing Director, Patrick Ayota, to justify the investment and explain how it would benefit savers, while assuring members that workers’ savings were secure.
In his response, Ayota confirmed that NSSF had invested approximately Shs165 billion in Marriott Hotel in exchange for a 30 per cent shareholding. He, however, assured the committee that the investment was secure and that members’ savings were not at risk.
Buzaaya County MP Martin Muzaale questioned the value of the investment and whether NSSF had conducted adequate market research before committing such a substantial amount of money.
Muzaale also cited the Sheraton Hotel, which he said had been on sale for less than Shs160 billion, questioning why the fund opted to invest in Marriott instead.
Other legislators, including Budadiri East MP Julius Nakiyi and Elgon North MP Gerald Nangoli, pressed Ayota to explain how long it would take NSSF to begin realising returns from the investment.
Ayota explained that decisions regarding the nature of investments and the period within which they are expected to generate returns are made by the fund’s Investment Committee in consultation with its Board of Directors.
Following the meeting, the committee directed NSSF to submit supporting documents relating to the Marriott Hotel investment to enable MPs to conduct further scrutiny.
NSSF also holds a 20 per cent stake in Serena Hotel, following an investment made in 2007.