WINDHOEK: GIPF Trustee Chairperson Ellaine Samson says the investment of domestic savings in the economy is long overdue, and warns that postponing such actions could result in an economic revolution by underprivileged Namibians.
She was speaking during the sixth annual Retirement Funds Institute of Namibia (RFIN) conference held here on Wednesday.
“We can no longer defer the wealth and resource distribution to the next generation. The challenge is for us to choose whether we are ready to bear the financial, economic, social, political costs that would result from our failures to address the abject poverty of our people,” she noted.
According to Samson, there are calls from members of the Government Institutions Pension Fund (GIPF) who want to access their pension monies to amongst other things pay off their debts at cash loan providers; pay school fees; buy residential property; and use it for a variety of other reasons.
In the quest to continue to invest in the economy, and for the sake of compliance, the Board of Trustees approved an Investment Policy for Unlisted Investments in 2008. The overall goal of the policy is to use GIPF funds to contribute to the development of Namibian capital markets with regard to unlisted investments.
The trustees came up with this policy through detailed studies of global best practices and they used lessons learned from the failed Development Capital Portfolio (DCP) as well as the potential of unlisted investments providing an alternative asset class.
An independent audit ordered by Cabinet in 2010 showed that the DCP lost N.dollars 400 million plus interest of about N.dollars 160 million, which could have been earned on the funds if properly invested. The police opened investigation dockets for each of the 21 DCP projects, two of which were forwarded to the Prosecutor-General for a decision earlier this month.
Samson said the investment policy came about due to a genuine wish and the conviction of the GIPF to invest in its members’ savings in the domestic economy to grow and enlarge the economy for broad-based participation. The scheme is to ensure that all the savings of the members of GIPF are not exported to develop other economies, but that the savings are used to improve quality for the fund’s members and the country as a whole with proper infrastructure such as roads, ports, education, health, transportation, sanitation and housing.
“The message is clear although expressed in various ways. The nation wants to see us helping them improve their lives and they want to see results,” Samson added.