Surprise shake-up at NSSF that ends Prof Kahyarara’s short tenure

Dar es Salaam. President John Magufuli has dropped the director general of the National Social Security Fund (NSSF) Prof Godius Kahyarara in a surprise announcement Saturday night.

Prof Kahyarara’s removal was made public in a brief statement from the State House. No reason was given for his removal in the statement signed by the director of Presidential communications Gerson Msigwa.

The statement said the Head of State had appointed Mr William Erio to replace Prof Kahyarara at NSSF. Mr Erio moves from the PPF Pension Fund where he was the director general. The changes are with immediate effect.

Prof Kahyarara, according to the statement, will be assigned another unspecified duty. The former University of Dar es Salaam senior don has served as the NSSF boss for two years. He was appointed in March 2016 to replace Ramadhan Dau who had served at the NSSF helm for a solid 15 years. Mr Dau is currently Tanzania’s ambassador to Malaysia.

His removal yesterday caught many of his peers by surprise, according to sources in the know who talked to The Citizen. According to the sources, Prof Kahyarara was believed to be among the President’s close confidants. His last known public engagement was On July 4, 2018, at the Dar es Salaam International Trade Fair when he accepted the award of NSSF at the overall winner at the exhibition. He received the honours from the Prime Minister Kassim Majaliwa.

Prof Kahyarara leaves office amid a cloud of uncertainty, reminiscent to the circumstances when he came in, in 2016. He was named DG by President Magufuli shortly after a dramatic reversal of the appointment to the same role of Dr Carina Wangwe by the Minister of State in the Prime Minister’s Office responsible for Policy, Parliamentary Affairs, Labour, Employment, Youth and the Disabled, Ms Jenesta Mhagama.

The mix-up was blamed not following due process, but Prof Kahyarara has since gone to become the face of recent transformation at NSSF as it positioned to implement President Magufuli’s directives.

Among the directives was to use the fund to help in public investment in industries as the government looked to own sources of funding to roll out its ambitious industrialization goal.

NSSF is currently the lone pension fund catering for the interest of private sector employees and some semi-autonomous agencies while a newly established Public Service Social Security Fund (PSSSF) will represent four collapsed pension funds namely PPF Pension Fund, Public Service Pension Fund (PSPF), Local Authorities Pension Fund (LAPF), and Government Employees Provident Fund (GEPF).

There has been some disquiet, including among some members of parliament and workers’ unions on the apparent appetite by the government to dip its arms into pension funds to fund some of its activities.

The fear was that a bullish push to invest pensioners’ money in building new industries and reviving old ones without a safety mechanism may jeorpodise their lifetime savings, a matter that has been denied by the government.

A recent decision to also restrict workers from accessing their savings until their attained retirement age has caused some discomfort and led to speculations whether the funds have adequate savings to meet the growing demand for investment and pension payments. The government has introduced an ‘un-employment benefit’ to cover for the gap in loss of employment but a majority of the workers’ unions were infavour of maintaining the withdrawal benefit for those leaving work while young.

It is still early to establish if any of the recent investment decisions by NSSF or the roll out of the new rules had anything to do with the removal of Prof Kahyarara who came in when NSSF faced scandals over failed real estate investments running into hundreds of billions of shillings revealed in an official audit report.

The NSSF board of trustees in July last year approved to sacking of 12 of its top managers in relation to the real-estate investment scandal, to allow Prof Kahyarara to establish his new team of managers to deliver on their strategic investment plan.

Among recent investments done by NSSF include a joint venture with PPF to construct a 200,000 tonnes per year sugar production factory in Morogoro region, Sh9 billion was spent in the revival of Mwanza milling factory while Sh4.7 billion was given to Tanzania Biotech Product Limited in Kibaha for production expansion.

Other recent NSSF projects include: The Kigamboni Bridge, Real estate projects, including the Dege Eco Village, the Kiluvya Hills and Mtoni Kijichi. NSSF has also invested in factories in Mbeya (for cement), Kagera (sugar) and Morogoro (textiles). Prof Kahyarara recently signed a memorandum of understanding (MoU) with Best Western Premier and Mega 5 Star Hotel for real estate development.

The MoU was for the 30-storey Mzizima Towers which is set to be open for the public in January next year whereas Best Western Premier is to set up a five star hotel next year.