MAKERERE University has sued the National Insurance Corporation (NIC) over a sh16.7b pension savings package it claims the insurance giant owes it.
In the suit filed last Friday at the Commercial Court, the university wants to be paid an interest of 25% per year on the money from September 1 until full payment is made.
The suit was jointly filed by the Registered Trustees of Makerere University and the Retirement Benefit Scheme through Kateera, Kagumire Advocates.
According to the suit, Makerere contends that on July 1, 1996, it established a retirement saving scheme to benefit its employees.
Records indicate that Prof. John Mary Sebuwufu, Avitus Tibarimbasa, Sam Kwesiga and Edith Mwondha were nominated to act as trustees.
Subsequently, the Deposit Administration Plan scheme was established and a trust deed was executed.
Makerere also contends that it signed a contract with NIC on June 28, 2004 where the insurance giant was tasked to manage the scheme. On April 1, 2009, the deposit scheme was renamed Makerere University Retirement Benefit Scheme.
Makerere alleges that NIC breached the contract by withholding vital information.
â€œNIC failed to furnish the plaintiffs statements showing the balance in the said account together with interest allocated on the account. It also failed to show the administrative expenses of the defendant as stipulated under the policy,â€ Makerere contends.
The university added that in the agreement, NIC was obliged to administer an account on which the university employeesâ€™ deposits would be placed.
Each eligible employee contributed 5% of their monthly salary. In addition, Makerere had to contribute 20% of the monthly pay for each employee.
The university contends that on August 18, 2008, it withdrew from the saving scheme. It asserts that an audit put the value of the scheme at sh27.9b.
They are demanding full payment, saying they only received sh10b.
Makerere sues NIC over sh16b