Cape Town - The need for checks and balances on the administration of public sector pension funds will be a major feature of the looming public sector wage negotiations.
The two biggest unions in the sector, PSA (formerly the Public Servants Association) and the National Education Health and Allied Workers’ Union (Nehawu) have both voiced concern about the manner in which pension monies have been used and allegedly abused.
The Government Employees Pension Fund (GEPF) invests its estimated R1.8trn-plus with state-owned fund manager the Public Investment Corporation (PIC), the largest such fund on the continent.
It has the usual fund management mandate of growing the value of investments, but it also supposed to assist in the transformation of South Africa’s economy while investing in “sustainable green projects”.
Of concern to the unions is the recent surge — to more than R45bn — in investments in unlisted entities, along with statements such as those by Finance Minister Malusi Gigaba that the role of the PIC should be reviewed. His comments followed the proposal by the ANC’s economic transformation committee that made it clear that the government had set its sights on pension monies as a source for “development funding”.
However, the prime media focus once the negotiation commence will be the mandated demands from the union memberships. PSA, which has now drawn up its mandated list of demands, will meet with Nehawu and other unions in coming weeks to attempt to put together a united platform.
What seems a non-negotiable position is that the unions will insist on a one-year pay and conditions deal. The government, as in the past, wants a three-year agreement.
Equalisation of medical benefits for workers subscribing to both the Government Employee Medical Scheme (GEMS) and other schemes should also feature, along with demands for an improvement in housing allowances. The pay demand mandate from PSA members — other unions are unlikely to go below this — is for a 12% across the board pay rise.
A final point on contention will be the fact that there are estimated to be more than 150 000 job vacancies in the public service, ranging from nurses and doctors to administrators. It will certainly be pointed out that this is a glaring contradiction for an employer — the government — that lists job creation as a priority.
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