No decision to redesign NIF portfolio, says labour minister
Minister of Labour and Social Security (MLSS) Shahine Robinson said yesterday that contrary to recent news reports, there has been no decision to redesign the National Insurance Fund’s (NIF’s) portfolio.
However, the minister confirmed that it is intended to give the soon-to-be-created merged NIF and National Insurance Scheme (NIS) entity corporate status.
“… I would like to clarify that no decision has been made in relation to the redesign of the NIF’s portfolio, other than the fact that it is intended to be given body corporate status,” she told the media at her quarterly press briefing at the ministry, North Street, Kingston, yesterday.
“Reports of impending fund management outsourcing, including multiple private pension fund managers, are merely speculative. A consulting firm has been hired and we await their deliberations to create greater value for the pensioners who benefit from the fund,” the minister added.
A comprehensive review of the NIF investment policy is to be undertaken by the consultant and a risk management policy developed.
The ministry had previously disclosed plans to overhaul the NIF, leading to a merger with the NIS.
The decision followed reports of deficiencies in respect of the NIF’s equity portfolio, and possible fraud at the NIS.
The NIF and the NIS currently operate as MLSS departments. It is speculated that the newly created entity/agency would oversee over $106 billion in assets. However, this would require several amendments to the NIS laws which have to be prepared for submission to the chief parliamentary counsel.
Robinson told the briefing that, in the meantime, the NIF continues its primary focus, which is to maximise returns within acceptable risk limits, while maintaining a level of liquidity to facilitate the timely payment of NIS benefits.
“The NIF continues to evaluate the asset allocation with a view to ensuring that there is appropriate diversification, given the ever-changing investment environment in which we operate,” the minister noted.
She said that the NIF continues to demonstrate strong financial performance. The net assets of the fund grew by $13.8 billion or 14.8 per cent, to $106.2 billion as at March 2018. For the first quarter of the fiscal year, the net assets of the NIF grew by 7.37 per cent to $114.02 billion, when compared to the 2.03 per cent over the similar period for 2017/18.
She said that the fund continues to invest in a diversified portfolio of assets comprising equities, real estate bonds and loans.
Over the last three years, the equity portfolio has been the main contributor to the growth in the assets of the fund, averaging 44.3 per cent.
As at June 30, 2018, the equity portfolio was valued at $26 billion, up 7.16 per cent since the start of 2018/19 fiscal year on April 1.
Also at June 30, the bonds and loans portfolios were valued at $73.68 billion, up 9.67 per cent so far this fiscal year.
Source: http://www.jamaicaobserver.com/news/no-decision-to-redesign-nif-portfolio-says-labour-minister_143407?profile=1606