Determinants of pension fund perfomance in Tanzania; a case of national social security fund ( NSSF) in Dar es Salaam,Tanzania

This study was about assessing the determinants of pension fund performance in Tanzania by studying a case of National Social Security Fund (NSSF) in Dar es Salaam, Tanzania. The main objective was to assess the determinants of pension funds’ Performance in Tanzania. The specific objectives of this study were: to find out the influence of investment strategies in pension fund performance in Tanzania; to determine the influence of membership size in pension fund performance in Tanzania; to examine the influence of contribution density in pension fund performance in Tanzania. This study employed a mixture of experimental and a case study design and employed quantitative approach with a study area being Dar es Salaam. The study used time series data to study various variables that influence performance of NSSF for secondary data collection. The data obtained was cleaned, coded and analyzed using STATA version 14 and presented in form of tables, charts, graphs and statistics. The main findings as per specific objectives were: the regression analysis and hypotheses testing showed a weak relationship between investment strategies, contributions density and membership size and age. The coefficients of membership size, age and contributions density showed that they were statistically insignificant while investment strategies were statistically significant although with a negative relationship with NSSF performance. The results agree and seem to confirm the findings of Jackowicz and Kowalewski (2011) that attributed performance not on age of contributors, contribution, assets and growth of funds but on both the composition of the board and the motivation of the board members while differing to the finding by Oxera Consulting Ltd (2008) in Kenya and Bodie el (II. (2009) that show that contributions affect performance of pension funds in countries with large informal sectors. The study recommends that pension funds ought to measure performance against optimal long-term benchmarks and that governments can play an important role in setting up these optimal benchmarks, but should not interfere in asset allocation. Further studies ought to study other variables that influence performance of Pension Funds’ performance such as regulatory framework, Board Size and Structure.