GOVERNMENT’S PROPOSED SOCIAL SECURITY AND RETIREMENT REFORMS
Posted on 17 July 2008 - 11h00
SEIFSA has received comments from a number of member companies that shopfloor workers in particular are concerned about proposed changes to existing pension and provident fund arrangements and especially the creation of a national social security fund to which all employees will be required to contribute. Some members have reported that workers are requesting to be paid out their benefits from their existing funds to avoid the government taking their money away from them when the new arrangements are introduced.
Companies faced with these concerns and demands from workers should assure them that there is absolutely no intention on the part of government to take away workers’ pension or provident fund benefits. In fact, one of government’s main intentions in introducing these changes is to ensure that all persons in formal employment enjoy pension benefits. For workers to withdraw from their existing funds prematurely will severely prejudice their benefits on retirement.
SEIFSA is fully represented on a Business Unity South Africa (Busa) working group which is involved with discussions with senior government representatives on this matter. Busa is currently developing a mandated position on all matters pertaining to the issue and this position will be communicated to government in future discussions. Busa is of the view that certain funds, including industry funds such as ours in the metal and engineering industry, should be allowed to remain independent of the proposed state fund and one of the matters under discussion is the criteria to be used in allowing funds to remain independent.
Discussions on these matters are likely to take some time, but SEIFSA will keep its members fully informed on the progress of these.
A joint government/ trade union press statement on this matter is also attached.
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