“In a society in which the majority of working-class people spend their lives in poverty and debt – either unemployed or working for poverty wages – there is no way in which they can accumulate enough money in their retirement funds to provide them with an adequate pension when they retire”, NUPSAW General Secretary Success Mataitsane.

The National Union of Public Service & Allied Workers (NUPSAW) has served Nedlac with a notice of intention to embark on socio-economic strike action, in terms of Section 77 of the Labour Relations Act, 1995, (Act 66 of 1995) on Monday 8 February 2016. The LRA in protest against reforms affecting provident funds as contained in the Taxation Laws Amendment Act 25 of 2015. NUPSAW’s reasons and objections are around the decision to implement compulsory annuitisation upon retirement from 1 March 2016.

Workers have over many years made it clear through struggle that their choice was for a provident fund system which allowed them to choose whether to take all of their benefits or to use it for a pension. This is a far cry from this compulsory annunitisation system which government is seeking to introduce, hence NUPSAW is opposing the new tax amendment and concurs with Treasury that for many workers the prospect of retirement and old age are indeed bleak especially when considered against the background of increasing rates of poverty, inequality and unemployment.

It is evident that the social and economic systemic and structural factors of Apartheid South Africa still persist in the Republic. Therefore, we are convinced that without simultaneously tackling the socio-economic factors and leaving the Apartheid labour market and economy virtually intact; it will be impossible for any meaningful and transformative reforms of this kind intended in the Tax Amendments to be useful to the black majority of South African workers who continue to suffer structural and systemic unemployment, poverty and inequalities both in the workplace and communities.

NUPSAW acknowledges that similar retirement fund regimes have been implemented elsewhere in the world, however, the persistence of the Apartheid systemic and structural factors on the country’s economy makes such retirement fund regimes impractical. The persistence of colonial wages means that most workers in this country leave employment with a pittance. This means that at retirement the majority of South African workers are left with a provident fund that is wholly insufficient to cover their needs.

The Forcing of workers to make withdrawals from their provident funds in order to subsist through unemployment, due to the absences of viable alternatives through a social security net such as basic income grant does not only further deepen the pit of poverty for majority of workers both post and pre-retirement; it also ignores the huge indebtedness of a poverty-stricken population.

NUPSAW with regards to the new retirements reforms demands the following:

1. That employees have the right to withdraw their full provident fund benefit upon retirement;

2. A comprehensive social security system to include;

• A non-means tested state old age pension of fixed at a rate capable of sustaining a decent pension, per pensioner;
• The implementation of the National Health Insurance scheme to provide access to free health care which will be accessible to all and of good quality;
• A basic income grants capable of purchasing essential needs, per adult;
• Art extension of the UIF to cover all registered unemployed persons for the duration of their unemployment;
• A non-means tested child benefit grant.

For more information:
Success Mataitsane, General Secretary
Cell: 072 575 9318 / 082 553 8465
Tel. 012 342 1674
Issued by Reneilwe Maluleke, Media Officer, Cell 072 699 5295 Tel. 012 342 1674