Social Security Board Eyes Investment Growth Amid Pension Payout Concerns

Social Security Board Eyes Investment Growth Amid Pension Payout Concerns

The Social Security Board says it needs to increase its investments to ensure it can keep up with pension payouts in the long term. The statutory body invested over five hundred million dollars last year and hopes to increase that figure to six hundred million over the next two years. However, the board has had difficulty finding secure investments in the local market. In recent years, the board’s proposal to loan millions of dollars to two companies faced much public criticism, which resulted in the agreements not being finalized. SSB’s Chief Executive Officer Deborah Ruiz says the board hopes to change the public’s perspective on expanding its investment portfolio so it can continue to offer critical services to contributors at various points in their lives. 

Deborah Ruiz, CEO, Social Security Board: “We have a hundred million liquid cash that we need to invest and put to work. But part of the process right now is legislated by law. How we can do it is not that independently we can say how we are going to do this. So we advertise that we are open for business. We are looking at viable proposals, but it has to go through a process, as you know, because of the framework. So we come in, we assess your ability to even make the loan that you qualify, you meet all your legal obligations, that due diligence assessment is done, and then we publish in the public domain, and based on feedback, if it clears that then we are able to go ahead with the investment. So it has to go through that process which can be a bit bureaucratic in terms of the turnaround time, and of course, it opens businesses up to public scrutiny, and some businesses who are very viable don’t want to go through that. So that has been a stumbling block for us in terms of we have started the conversation and when they find out that it requires this public scrutiny of their, they don’t want. So that has been a stumbling block. That has been a challenge for us. It’s very, you’re strapped in terms of your ability to even move. So that requires further conversation with our stakeholders manage the good governance and the accountability, but be able to have flexibility to move the money and put it to work for our customers.”

Compared to its peers in the region, the SSB is the only statutory body required by the law to seek the public’s approval on investments. Ruiz spoke about the need to improve the way the information is shared with the public but noted that it is a hindrance to the board. 

Deborah Ruiz, CEO, Social Security Board: “We also have our annual SSB connect where we do have a physical presence but we also stream it live on Facebook where as part of our mandate we give the annual report summary to the people in terms of the performance of the fund, all the different investments that we have made and as you know part of the process right now which is a little cumbersome because it has to go through a process in terms of the turnaround of how we can respond to applications to notify people of how the fund, the board intends to invest the money. So right now on our website the financial statements are available and so what we are trying to do in terms of going forward not everybody is an accountant or has a full understanding of these reports so we’re trying to explain to people in layman’s terms what those reports are saying in terms of the investment of the fund.”

The board’s investment committee is tasked with scrutinizing loan proposals.

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