Eswatini National Provident Fund
The Fund continues to pursue its minimum risk investment goal and it further continues in:
Ensuring that all assets are liquid and tradable, including all property investments.
Striving to yield investment returns in excess of inflation over the medium to long-term horizons.
Reducing property investment exposure to an absolute maximum of 20% of total assets in line with international portfolio trends.
Balancing the Fund in both regional and global asset allocation to reduce risk and enhance returns.
Reviewing intellectual support provided to the Fund through a multi-manager approach.
It is in the Funds’ interest to safeguard and maximize members’ funds. The investing strategy of the Fund remains focused on achieving good returns whilst minimizing the volatility of returns, as such, balanced investment portfolios are generally utilised.
It is important for members to know where the money that is used to grow their accounts comes from. The Funds’ investments are controlled by a special committee called Investment Committee consisting of the Principal Secretary, Ministry of Finance (who becomes chairman of the committee), and two members of the public experience in financial matters, and the Chief Executive Officer of the Fund.
On receipt of the contributions, the Fund, through its Investment Committee invests the money in the best way possible. In terms of the Order, the Fund deducts from the total returns collected each year, administration costs i.e. salaries, motor vehicle expenses, travel costs, etc. From what has remained, the Fund pays interest to all members’ accounts at the rate determined by the Board from year to year.
This rate of interest shall be fixed by the Board in such a way that a surplus remains for credit to the reserve account in compliance with the provisions of the Order.
Over the past five years, we have taken great strides towards investing at least 30% of our assets locally, per the requirements of the Retirements and Insurance Funds Act of 2005. In 2008 our compliance rate was 31% of our investments, 33% in 2009, 34% in 2010, 39% in 2011, 40% in 2012 and 42% in 2013.
Just like all other years the most important function of the Board as regards ensuring that the Fund declares annual members’ interest that is above the threshold of 3% as set by the Swaziland National Provident Fund Order No.23 of 1974 has not been forgotten. As we have done over the past four years the percentages declared to continue to be higher than all other interests in the financial industry. For the year under review, we were able to declare a member interest of 8.5%.