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Govt revokes proposal to force employees to contribute to state-run pension fund

1 September 2021 12:58 PM
Tags:
Retirement
Insurance
Personal finance
Mandy Wiener
investing
investments
Pension
The Midday Report
social security
Studies In Poverty And Inequality Institute
Isobel Frye

Mandy Wiener interviews Isobel Frye, Director at the Studies in Poverty and Inequality Institute.
  • The Studies in Poverty and Inequality Institute is disappointed that the government has withdrawn the green paper proposing mandatory contributions to a pension fund

  • It says the response to the green paper by organised business was not “in good faith”


The government has withdrawn the green paper that proposed a compulsory pension and insurance fund for workers.

It gave no reasons for the withdrawal.

The government wanted all formally employed workers to pay up to 12% of their earnings into a state-managed social security fund.

© michaeljayfoto/123rf.com

"There were far too many wide-ranging and negative impacts that just talking about was going to have on the economy," said Wayne Duvenage of the Organisation Undoing Tax Abuse (Outa).

"You have to make sure you have your social partners or stakeholders fully engaged,” said Cosatu’s Sizwe Pamla.

“We don't want to shoot the entire thing down.”

Mandy Wiener interviewed Isobel Frye, Director at the Studies in Poverty and Inequality Institute (scroll up to listen).

We need to understand the full process around this… I’m very disappointed that the green paper has been withdrawn… We started talking about this around 2008… The idea is not new…

Isobel Frye, Director - Studies in Poverty and Inequality Institute

What is in the green paper has been worked on in incredibly fine detail… As a member of the negotiating team, I cannot say that the recent responses by organised business and National Treasury are completely in good faith…

Isobel Frye, Director - Studies in Poverty and Inequality Institute

We are talking about the adoption of a new social security fund. It would not be done in parallel with existing pensions… When this fund comes into being – we’re looking at about five to 10 years’ time – it would be the only pension contribution for the majority of low-income workers… All vested rights… will continue to be held by the private pension funds…

Isobel Frye, Director - Studies in Poverty and Inequality Institute

It’s important that the debate… continues with the urgency it needs…

Isobel Frye, Director - Studies in Poverty and Inequality Institute



1 September 2021 12:58 PM
Tags:
Retirement
Insurance
Personal finance
Mandy Wiener
investing
investments
Pension
The Midday Report
social security
Studies In Poverty And Inequality Institute
Isobel Frye

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