If you're an employer or an employee who pays the monthly contributions to the Social Security Board, you'll definitely have felt the increase in contributions, which took effect last month on July 15th.
And while you may not be too happy that you have to pay more money out of your salary or your earnings, the fact is that the change has allowed the Social Security Fund to start making small growth, so that it can remain financially sustainable for future generations.
The SSB has successfully managed to avert an impending financial crisis, where the annual benefit payments would have exceeded the collections from contributors, added to the return on their investment portfolio.
But, to get public buy-in, SSB has taken the necessary steps to reduce the cost of its own operations, as well as to be more transparent in the way they use your money, as a contributor.
That's why they organized an event this afternoon called SSB Connect. It started in November of last year, and the executives are treating it as an annual general meeting, to report to the general public on the organization's financial picture for the previous year.
The event ran at the Biltmore Plaza Hotel for over 2 hours this afternoon, and the keynote speaker was CEO Dr. Collin Young. He went over bottom lines in all the different categories, and we've put together an excerpt of some of the more important facts that he shared with the attendees. Here's what he had to on how well SSB performed last year, several months before the new contributions took effect:
So, what about their operational expenses? Here's that part of the CEO's presentation:
Dr. Colin Young, CEO - SSB
"I want to make a point here. So 22.7 million dollars in 2017, 22.4 in 2018, so there was a decrease in operation expenditure by $375,000 and in actual administrative cost there was a 2% reduction, almost $500,000 in reduction and this is from a number of activities that we have taken at the board to reduce cost and these you will see them increase in subsequent years, for example we've closed some of the sub-offices. In the country we've turn our air conditions into energy efficient ones, the lighting has change. So we've decrease electricity expenditure and we've renegotiated all of our contracts with suppliers, because people generally when they see social security green they probably seem to think that we have a lot money and you get the social security price often times a lot of things and so my finance team Leo and others, they are often on the phone with suppliers and service providers negotiating better prices."
"So, after all of that, the contributions we get from you 87 million and all the income we obtain from investments 20 million in 2018 - that give us a total income 108 million. The red line represents expenses which accounts for 74 million dollars in benefit expenditure plus the administrative cost and the purple line represents the 20 million investment income and this little line here which has 12.1 million, that was our excess income over expenses. So for the year ending 2018, if you want to call it that SSB had a profit of 12.1 million dollars which was a little bit better than forecasted in 2017, but in 2019 as you saw from a lot of the presentations we did, we were going to in the late 2017 expect to get close to the period of equilibrium, that is why we had to do the increases in contributions, because we did not want to wait until you are over the cliff to then make changes in the contributions schedule."
And in the final part of the newly instituted AGM, the SSB executives wanted to educate the public on how they are changing the way they do business, to make you, their customers, more satisfied. They're becoming more tech-savvy so that you can do most of your business with them online.
Here's what the CEO had to say about the impending changes that they want to implement:
Dr. Colin Young, CEO - SSB
"Social Secutity systems the world over are embracing ICT and technology, primarily to increase efficiency and service delivery. One of the promises we made to persons especially as a part of the contribution reform we are paying more, people are demanding better quality service. They want to be served quickly, they want to be served efficiently and they want to be served via channels of their choice. People may not want to come into the branch; they might want to do online and so what we are doing is modernizing the technology platform of social security that is old by using technology. What this means is that we will be moving a lot of the services that we have online. For example one of the issues right now is that you have to physically walk into our branch to check on your contribution history. You'll have an app that you can check online to see what your employer has played, what you have paid, the total that you have paid. So we empower the employee to make sure that their employers are paying the right amount and so on. Another one is that we will have a doctor's app where when you go to the doctor and you're sick, rather than walking that form into the office, the doctor will be able to submit that through the app directly to social security. Again, we talked about biometrics and the use to validate pensioners and so that you don't have to fill in forms. You will be able to apply for your registration or your card complete almost all of the process online and then you walk in. Right now it takes five days to get a card; we will be able to get a card in two days as a result of the changes that we are making. So essentially we are responding to the demand from our customers that they need to be served better, and they need to be served faster and they need to be served in a way that is convenient to them."
The SSB is launching a new digital platform called "Peransa," which they hope will positively enhance customer service delivery.
