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BL Premium reports that trade union federation Cosatu said on Sunday that proposed changes to the Pension Funds Act regulations would help mobilise much-needed investment in infrastructure.
On Friday, the Treasury gazetted long-awaited draft changes to regulation 28 of the Pension Funds Act aimed at encouraging the savings industry to invest in infrastructure. The changes come after political pressure on the government to compel greater investment in areas that have a developmental function. The solution proposed by the Treasury is seen as an alternative to the policy of prescribed assets mooted by the ANC as a way to meet development financing needs. The Treasury noted that the decision to invest in any asset class, including infrastructure, would remain that of the board of trustees of a retirement fund. The proposed amendment does not add infrastructure investments as a specific asset class alongside the existing list of asset classes but it makes provision for infrastructure investment to be recognised within the asset classes. "We are happy with [the proposals]. We think it’s the right thing to do and it’s being done in the right way that doesn’t alarm anyone," said Cosatu’s Matthew Parks. He said the proposals did not amount to asset prescription because "no-one is forced" to invest, adding that "fiduciary duty, financial integrity and due diligence" had to be respected.
- Read the full original of the report in the above regard by Lynley Donnelly and Carol Paton at BusinessLive (paywall access only)
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