Fin24 reports that concerns that politicians view the Public Investment Corporation (PIC) as a cash cow are looming large over discussions to establish an overarching pension fund for SA.  

The new centralised retirement fund or National Social Security Fund (NSSF) will centralise the current more than 5,000 public and private retirement funds into one giant mandatory institution, possibly under government control.  It will aims to force South Africans to save for retirement, as well as cross-subsidise lower income earners.  It also plans to cut administrative costs and streamline all funds, as well as the Unemployment Insurance Fund, into a single integrated structure.  All income earners would be required to pay 12% of their annual salary to the NSSF, creating the multi-trillion rand fund.  But labour and investment analysts have warned that unless the centralised fund has good governance structures in place, it could potentially be used to bail out failing state-owned enterprises (SOES).  The new fund’s negotiations are taking place at the National Economic Development and Labour Council (Nedlac), where progress has been slow.

• Read this report by Tehillah Niselow in full at Fin24

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