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SPF invests for the future |08 February 2016

‘To be sustainable SPF has to invest’

 After its official opening late last month, Maison Collet, the first multi-storey car park and offices in Victoria built and managed by the Seychelles Pension Fund (SPF) has started operations by welcoming its first tenants as of Monday February 2, 2016. The opening ceremony, which saw Vice-President Danny Faure unveil the commemorative plaque, coincided with the SPF’s tenth anniversary celebrations which started that day.

Both public, visitors to the building and occupants of the new offices there, are enjoying this modern, airy and spacious public parking space in town and one that is driver-friendly “with none of the tight little corners that are the misery of urban life” as the chief executive of the SPF, Mrs Laika Nair, described.  It is totally mechanised and spread out over ground plus two floors. The building opens up a new space designed to meet the increasing demand and expectations of Seychellois.

Coming at a cost of about R140 million, Maison Collet is a combination of multi-storey car park facilities and office premises. The SPF expects a 9.15% rate of return on this investment with a payback period of 11 years.

The parking facilities are situated on the first three levels. The first two floors can cater up to 50 cars each while the third floor can provide parking to 54 cars making a total of 154 parking spaces. The ground floor parking facilities is for public parking and visitors to the building and will be chargeable by the hour with the first hour being free. Thereafter a fee is applicable for payment depending on how long the vehicle is parked. On the other hand the first and second floor parking is reserved for tenants on monthly basis. The associated fees chargeable for pay parking are per slot at R800 per month. While all other floors of the building can be accessed through lift and staircase, there is no lift access to the second level parking. The parking facility is restricted to vehicles below 1.9m high. SPF will have parking attendants stationed at the parking to help members of the public until 10pm daily.

The Maison Collet is already housing the Ministry of Fisheries and Agriculture and the Seychelles Revenue Commission on the third and fourth floors respectively. The two departments of the ministry are sharing the third floor, while the Seychelles Revenue will occupy the entire fourth floor.

The SPF is now in its 10th year of existence. Its aim is to continue providing financial security to its members, the Seychellois workers, on retirement to live in basic comfort or to their close dependents in case of death before and after retirement. It provides pensions on retirement, in case of disability and to qualified surviving spouses and children in case of death of members before and after retirement and benefit to dependents or heirs where the member does not have children or surviving spouse and through a lump sum payment equivalent to their contribution for those who eventually do not qualify for a pension.

Maison Collet was chosen after several dozen names were proposed by the SPF staff for the building, as it was felt that, given Charles Collet’s strong passion for the betterment of the poor Seychellois in the mid-1900s, and his efforts in modernising the laws of Seychelles, it would be good to honour such a person by having a building named after him in Victoria. Coincidentally, Charles Colett was a tax reformer and Maison Collet is situated in the St Louis district, the same district where Charles Collet was born – an appropriate name for the building that houses our tax offices.  Members of the Collet family were also present on the occasion.

As explained by the CEO, Maison Collet is actually the second phase of the development of this area, having built Unity House in 2012 as the first phase. She added a third phase comprising the building of commercial structures at Huteau Lane site will follow up later.

“This speaks volumes about our commitment and denotes the continued progress that we are making, both in our investments and as part of our social responsibility. Prudent and cautious investments, for any pension fund, is crucial for its survival. As you are all aware, SPF places huge emphasis on its investment programme, particularly in property development, which it embarked on right from the beginning in 2006,” said Mrs Nair.

Mrs Nair also explained the ‘raison d’être’ behind the SPF’s investments project and a bit on the history of the institution.

When the SPF was established in 2006, she said, the fund had 877 members who attained retirement age. Ten years later, they are paying retirement pensions to 4,226 members – a five-fold increase.

In recent years SPF have witnessed a global demographic transition where there has been a significant increase in the elderly population and low birth rate in many countries. In a nutshell, the Seychellois are living longer and are not being replaced at a rate that will ensure that in 10, 20 or 30 years, the workforce will be sufficient to sustain the elderly population of the country.

Therefore this creates challenges for pension systems like ours and can threaten their sustainability. Many countries, especially the developed ones, are facing these challenges today and had to adapt their pension systems accordingly.

Mrs Nair added Seychelles is no exception. With average life expectancy improving each year, today being 75, and the trend set to continue, it places a great emphasis on the sustainability of the SPF. However, we in Seychelles, have been fortunate, in that we have been wise in our investments and as a result we have managed in the past ten years to improve, rather than claw back, on the benefits that our pensioners enjoy.

Furthermore, Mrs Nair said, January of last year saw a review in the pension formula used to calculate pension, where the number of years an employee has contributed to SPF and the wage growth were factored in the formula, which has ensured a substantial increase in the retirement package of our pensioners. In fact from last year, some of the Seychellois pensioners are getting over 80% of their last salary earned prior to retirement, as their monthly pension.

“To be sustainable we have to invest and SPF has done just that over the last ten years of its existence. Naturally, investments in property is not the only area that we are involved in, as we expand into more diversified investment portfolio and even venturing in investments abroad.  

“As we speak, SPF has around 50% of its investment portfolio in real estate in prime locations, 22% deposited at commercial banks, 17% in government securities, overseas investments of 7% and 4% in equity shares. In real estate, we have constructed 13 buildings located on Mahé, Praslin and La Digue, all operational and all occupied to their full capacity.

Mrs Nair stated the SPF has more projects on the cards and it believes the area is all steps in the right direction.

“We continue to look for better investment opportunities, and better returns ensuring all the time that our capital is preserved as we are always aware that it is the members’ funds that we are entrusted with – the contributions of each Seychellois worker. We take this very seriously,” remarked the CEO.

Mrs Nair also stressed the need to educate these young workers about the importance of saving for their retirement, even if it is so early in life, as the new formula incorporating number of years of contribution, helps to increase the pension at the time of retirement.

To that effect the SPF will soon go on a publicity campaign and will be visiting post-secondary educational establishments and work places. Another targeted group are the self-employed who, according to Mrs Nair, continuously and conveniently “forget” to contribute to their pensions.

'Rezouisans mon kouraz', a song dedicated to the building and to the SPF by Roland Andre

 

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