About 21 years ago, Members of Parliament (MPs) started the Uganda Parliamentary SACCO with a view of saving cash for future needs as their job has always been demanding.
Most former legislators would undergo difficult times after losing their seats in the House whose retention rate is less than 30 percent every election cycle.
At the 21st Annual General Assembly of the Parliamentary SACCO, Robert Migadde, the Board Chairperson, revealed that the over 1500-member institution has Shs67b worth of assets.
The Deputy Speaker of Parliament, Thomas Tayebwa, while presiding over the Annual General Assembly, challenged the Parliamentary Saving and Credit Cooperative Organisation (SACCO) to devise means of transforming into a banking institution because it has managed to grow its assets.
Tayebwa said that the bank would bring more money for the benefit of the members through the growth of profits on their shares when loans and other products are taken by the clients.
“Looking at this SACCO with assets of around Shs67b, this is huge and I think next year, we need to look at owning a bank. I have seen some of the banks where you are fixing money, they don’t have that money,” Tayebwa said.
He then asked: “Why can’t we make it and then each one of us shall have a sense of ownership?”
Migadde also expounded on the general growth of the 21-year-old SACCO. He revealed that the audited books of accounts indicate that by June 30, 2023, the SACCO grew by Shs18.21b from Shs29.36m to Shs47.57b by the close of the financial year.
The SACCO has also recorded an increase in the loan uptake from Shs25.34b to Shs33.44b with Pamela Kamugo, Woman MP Budaka District awarded as the best borrower while Tororo South MP, Fredrick Angura was announced the best saver.
“Also, we have grown the total assets from Shs47.34b to Shs67.7b and I think credit goes to you MPs, the former members and staff,” said Migadde.
The Deputy Speaker commended the SACCO management for the decision to invest in long term ventures like fixed deposits because they return more income on interests.
A fixed deposit is a tenured deposit account provided by banks or non-bank financial institutions which provides investors a higher rate of interest than a regular savings account, until the given maturity date.
Tayebwa said, “I know how the markets have been performing and I am glad you are opening up to long term investments and it is one thing which I have been telling you because when I see you investing in fixed deposits and yet these people are putting money in long term treasury bonds, then I was asking myself, what are you doing?
Revealing that most of his savings on emoluments from Parliament are in the Parliamentary SACCO, the deputy Speaker encouraged legislators to save a significant percentage of their monthly income in order to cater for financial shocks in the future.
He said that because legislators spend a lot of money on campaigns to secure return to the House every election, they need to mitigate the financial risks.
“I have seen in Parliament the issue of saving culture is bad because of the pressure we have in our constituencies. You see someone who is earning almost 10 percent of your salary is growing and you are not growing. In campaigns we have money and you don’t know where it is coming from.
And I think it is a problem of many Ugandans who spend much more than they earn. The issue is all about us managing our appetite for risks. The money we earn if you decide to say I will save 20 percent of it and I will forget about it, don’t you think it can help very much. The Indians save before eating, Africans we eat and then after we save,” he emphasized.
Migadde told the Assembly that the SACCO has positioned itself on an international level by subscribing to the African Confederation of Cooperative Savings and Credit Association (ACCOSCA), an opportunity that has opened gates for more training in financial management.
“At the continental level the SACCO is now an associate member of ACCOSCA. This year our SACCO was represented in Zimbabwe and Botswana where we received training in SACCO management. Also, we received a delegation from the National Assembly of Zambia SACCO who were here to benchmark on how our SACCO operates,” he stated.
He also said that the SACCO is already planning on embarking on Corporate Social Responsibility (CSR) with hope to identify and support some needy families across the country.
The SACCO’s General Annual Assembly passed a resolution to write off up to Shs421.3m loans for former members who have since passed away.