Yesterday the announcement was made that the government was exploring a mandatory pension system that would see employees pay as much as 12% of their monthly salary into a state-run pension fund.
Minister for social development, Lindiwe Zulu, published the proposals in a Green Paper on comprehensive social security and retirement reform for public comment.
South Africans have always been wary of how the government uses taxes and haven’t been shy to voice their displeasure for proposals like the National Health Insurance (NHI) and a 10% hike to pay for a basic income grant. The proposal of a mandatory state-run pension fund is enough to cause a middle-class revolt.
In her piece for Financial Mail, Giulietta Talevi weighs the proposal up and dissects why there is so much trepidation from citizens to have their pension money managed by the government.
Talevi’s opening salvo must surely be the sentiment of many employees right now, “If you want to start a middle-class revolution in SA, start messing with people’s pensions.”
Helena Wasserman compiled a report for Fin24 breaking down how the contribution would be used.
“All employers and employees will initially be obliged to contribute up to 12% of their earnings – up to a certain ceiling, which is currently proposed as earnings of R276 000 per year. This means that if you earn more than R276 000 a year, you will pay a maximum of 12% of R276 000 a year – around R33 100, or R2 760 a month – to the fund.”
Higher-income earners will also be expected to contribute to their own private pension funds.
While trade union Solidarity slammed the proposals and accused government of over-taxing South Africans with more and more taxes for less deliverable services.
The union also threatened to take legal action against the proposals.
Here’s a roundup of the most interesting opinions and analyses:
Daily Maverick
The Taliban’s return to power and what that means for the US dollar’s prospects – Jim O’Neill
President Ramaphosa’s toothless Cabinet reshuffle and notions of ANC reform are contemptuous – David Gant
News24 / Fin24
‘The damage is done’ – Top disease experts on Susan Vosloo’s ‘completely incorrect’ view – James de Villiers (for subscribers)
Do sex differences in the highest echelons of leadership matter? – Soraya Seedat
Business Day
Michael Jordaan’s new bank zeroes in on simplicity and small business – Stephen Cranston (for subscribers)
Raise the drawbridge and local won’t be so lekker – Peter Bruce (for subscribers)
Afghans were dumped so the US can focus on China – Steven Kuo (for subscribers)
Financial Mail
JSE execs no match for the hackers – Rob Rose (for subscribers)
Why did Cyril not shoot the deputies? – Justice Malala (for subscribers)
Mail & Guardian
Julian Assange: A day in the death of British justice – John Pilger
Inventive cold chain solutions for Africa – Stefano Marani
The Citizen
Pupils betrayed by abysmal education system – Isaac Mashaba (for subscribers)
