SOUTH AFRICA - Leading figures in the South African pensions industry have called for confidence to be restored in the country's pensions system, following a series of scandals.
Owen Barrow, a pensions lawyer at Cliff Dekker, told Global Pensions: "The large majority of funds are pretty well run but there are certainly issues which need attention. Trustees have not been doing their work on corporate governance over the last few years.
"The government needs to build up the confidence in the pensions system. This is particularly true after the number of scandals which have broken."
Anne-Marie Dalton, chief executive officer of the Principal Officers Association of South Africa, said the retirement industry was presently in the midst of a serious in-depth and comprehensive reform process which brought its own uncertainties and challenges.
She said: "My sense is this is the major cause for the current inertia. There is evidently a "run" on pensions and provident funds whereby members are withdrawing benefits in fear of losing their savings due to the reforms."
However, she said confidence could be restored through proactive and timely intervention by the regulator. "The industry is highly regulated and some may say even over-regulated, but such intervention is welcomed in the present environment," she said.
Dalton concluded: "National Treasury and the Labour Movement extended a firm warning to unscrupulous individuals and service providers who have started to circulate rumours suggesting the government will nationalise or take away the money in pension and provident funds in 2010."
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