IRR to pressure firms to protect the safety of pensions

Staff Writer | Jun 24, 2019
What are the biggest pension funds doing to protect their clients from the threat that they'll become 'prescribed assets', asks the IRR.

The IRR has announced that it will be writing to the CEOs of the biggest pension funds in South Africa to determine what they are doing to stop expropriation without compensation and specifically the threat of prescribed assets. 

The government and the ruling party have said they may seize pension fund savings in the country in order to plug government spending gaps. 

IRR Head of Campaigns, Marius Roodt said: ‘In response to dire fiscal circumstances in the country the government is certainly getting its ducks in a row to seize pension funds savings if that is required to prop up government projects and parastatals. Our greater concern though is that pension fund administrators are not doing enough to warn their clients of the danger or to safeguard their savings. Some fund administrators we have spoken to are in denial about the seriousness of the threat while others don’t want to get involved. We have also had members of the public and of funds reaching out to us to take steps on their behalf to safeguard savings.’

The IRR will be making contact with the managers of the largest pension funds in the country to put into practice strategies and processes to protect their clients’ interests. If those funds do not act with sufficient vigour the IRR will use public and media pressure to force them into action. The IRR will also begin to lay out a legal strategy in the event that the government cannot be dissuaded from seizing the savings and investments of households.         

 

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