PARLIAMENT is due this week to discuss the NSSF contract for infrastructure work at the Tassia estate.
The cost has risen from Sh3.5 billion to Sh5 billion. Superficially this does not seem excessive considering that there are over 5,000 houses.
However by focussing on the cost of the upgrade, we are losing sight of a much bigger question.
Are the members of the NSSF getting value for money? Will this investment provide a satisfactory return?
Investors can get nine percent interest buying Kenyan Treasury Bills. This should be the minimum rate for NSSF savings.
In the past, workers ignored the NSSF rate of return because they did not pay much.
However starting this month, the 2.2 million members will pay six percent of their gross salary to the NSSF matched by six percent from the employer.
NSSF will therefore receive Sh10 billion this January, and around Sh115 billion this year. This is a lot of money.
Unless NSSF savers get at least nine percent interest, they are being swindled.
So MPs should ask the big question this week, what is the Return on Investment of Tassia? Is the NSSF getting an annual return of at least nine percent on the Tassia project?