Inge Lamprecht
1 minute read
25 Feb 2015
2:07 pm

‘Significant progress’ with retirement reform

Inge Lamprecht

Significant progress has been made with regards to retirement reform and consultations with the National Economic Development and Labour Council (Nedlac) is ongoing, Finance Minister Nhlanhla Nene indicated in his 2015 Budget Speech.

Picture: Thinkstock

Amidst considerable pushback from labour unions, National Treasury in October last year submitted a proposal to delay certain aspects of the retirement reform process that was due to be introduced on March 1 this year to March 1, 2017.

It seemed labour unions wanted more clarity on social security reform (amongst other issues) before any support was given to the retirement reform process. The proposal for compulsory preservation was also a contentious issue.

On Wednesday Nene said the first draft of default retirement reform regulations will be published for public comment “shortly”.

“These reforms have one central objective: to maximise the long-term benefits to retirement fund members, so that they can retire comfortably,” he said.

He also indicated that an agreement has been reached with Ministers Dlamini and Oliphant to “jointly publish the long-standing discussion paper on social security reform”.

“Both health insurance and social security are vital concerns of all South Africans, and we look forward to public debate and engagement between stakeholders,” he said.

Nene said Treasury has noted that some government employees are resigning from the Government Employees Pension Fund (GEPF) due to high debt levels or inaccurate information about the retirement reform process.

It seems some government employees are concerned that they won’t have access to their money once the reforms take effect.

“I want to assure civil servants that the pension reforms currently under consideration will not adversely affect benefits to members of the GEPF,” he said.


Social grants

By December last year 16.4 million beneficiaries received social grants.

The minister also announced changes to monthly social grants from April 1:

• The old age, war veterans, disability and care dependency grants will increase by R60 to R1 410.

• Child support grants increase to R330, foster care grants increase by R30 to R860.