The Congress of South African Trade Unions (Cosatu) has disagreed with National Treasury’s statement – that members of the Government Employees Pension Fund (GEPF) will be excluded from new rules enabling pre-retirement withdrawals.
This follows nationwide calls to allow members of retirement funds to access part of their savings, due to the negative economic impact of the COVID-19 pandemic on household budgets.
Cosatu Spokesperson Sizwe Pamla says public servants also deserve access to some pre-retirement funds, as their pockets were also negatively hit.
“What we are not going to allow is for them to mismanage the economy to the ground. They are arguing that public servants are all fine, they received their salaries for last year so you don’t necessarily need to be accommodated here. We are only focusing on people who at some point were sitting at home and weren’t able to get their salaries. But they said something very different last year – they said to the public servants that we are unable to adjust your salaries in the agreement because of COVID-19. The principle here is that there has to be a process to allow workers to assess how much are those modalities and we are open to discussing them,” says Pamla.
Pros and cons of early pension withdrawal: Victor Bucarizza
Treasury defends decision
National Treasury says they aim to ensure that people do not deplete their retirement savings. The new rules are expected to come into effect in 2022 after talks are finalised.
“Our objective is to get people to save for their retirement and not to withdraw their funds and have no funds when they are much older and unable to work. We don’t have finality for any proposal yet. We are in the process of finalising all pension funds and we are in a discussion. If we take the issue of government public servants, they are continuing to earn a salary. We haven’t lost our jobs. You cannot have a situation where everyone will want to withdraw their funds because you are going to create a problem for the GPRF,” says Ismail Momoniat, Deputy DG for Tax and Financial Sector Policy at Treasury.
Pros and cons of withdrawing money from your pension fund: Eunice Sibiya