Rumours causing teachers and cops to quit, cash in on pension

2015-02-10 14:26

Thousands of anxious civil servants, mainly teachers, have resigned and cashed in their pensions.

“It is evident through anecdotal evidence that, of all professions, teachers followed by members of the South African Police Service are the most affected and continue to resign because of the misinformation around pension reforms,” chief operating officer of the Government Pensions Administration Agency, Jay Morar, told reporters in Pretoria today.

“I would like to urge the [Government Employees Pension Fund] members to stop resigning because they are afraid that they will lose their hard-earned money, especially their lump sum benefits.”

Morar said rumours were circulating that from March, members of the fund would no longer be entitled to a lump sum, as part of a proposed pension regime.

“Sadly, this state of affairs is still continuing unabated. I would like to take this opportunity once more to categorically dismiss this assertion as a total lie,” he said.

“Nothing is further from the truth. All members of the fund will still be entitled to a lump sum when they retire – no matter the date.”

He said the proposed pension reforms were aimed at harmonising pension funds and provident funds.

“I can confirm that the national treasury has decided to suspend the introduction of these pension reforms pending further discussions at the [National Economic Development and Labour Council],” said Morar.

“It is hoped that they might be re-introduced by March 2016, provided an arrangement is reached. Alternatively, the pension reforms will be introduced in March 2017.”

He said the Government Employees Pension Law of 1996 was not undergoing change. The retirement reforms would only affect provident funds regulated by the Financial Services Board through the Pension Funds Act.

Morar said the growing trend of resignations was observed from May to November.

“The trend continued to escalate until November last year when we had the largest volume of resignations that we have ever seen.

“The highest number of resignations were around 4600 in a particular month [November]. That means we physically paid for 4600 resignations in a month,” said Morar.

On average, Morar said, the Government Pensions Administration Agency received 2239 resignations a month. It had processed an average of 749 deaths a month over the past seven years.

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