We can learn a lot from RSSB data, including the following:
1. Active contributors to the Rwandan social security was 394,367 as of June 2015.
2. The overall financial position of RSSB and its investments and bank accounts was RWF518 billion or USD647 million in June 2015.
So if we look closely at these two figures – (1) size of active membership and (2) consolidated financial position of RSSB, what can we learn about Rwanda?
LESSON 1: Rwanda remains an extremely poor country. The population of Rwanda is nearly 12 million of whom 6 million are economically active aged between 15-65 years. Which means that out of 6 million economically active, only 394,367 who are active contributors to RSSB, earn wages in the government and the formal private sector economy. In other words, 6.5% of the economically active population work in the formal sector, while the vast majority of 93.5% are trapped in rural subsistence and urban informal sector.
LESSON 2: The consolidated financial standing of the Rwanda pension (including assets and bank deposits) amounted to RWF518 billion in June 2015. This is equivalent to USD647 million. To understand how tiny the amount of savings from all Rwandans in the workforce is, annual aid to Rwanda is by far larger at USD1 billion.
LESSON 3: Rwandan contributors to social security aged 20 years and younger numbering 4,176 (see RSSB Table) contribute only 1%. Contributors aged 20-24 years totalling 45,590, contribute 12%. We know that the total population of Rwandans aged 15-24 is 2.2 million. This means that out of 2.2 million Rwandan youth only 49,756, or 2.2% hold formal jobs.
LESSON 4: Sitting in bank accounts in June 2015 was RWF189 billion of pension cash (USD236 million) constituting 36.5% of total RSSB wealth. Is this money still there? Is it safe? The biggest threat to RSSB money in the government of Rwanda and RPF companies. The Kagame government often forces RSSB to put people’s money into prestigious projects such as the Kigali Convention Centre. RPF companies such as East African Granite Industries were built with pension money.
Lastly, we know from the Auditor General of Rwanda that RSSB management is in a big mess. Former RSSB CEOs tend (a) not to last long in their position, (b) flee or (c) imprisoned without clear charges. Let us watch what happens next, under the chairmanship of Dr. Innocent GAKWAYA, who happens to be President Kagame’s brother-in-law.