SCA ruling threatens industrial retirement funds – lawyer

Personal Finance quotes pension funds lawyer Jonathan Mort, director of retirement fund specialised services at Edward Nathan Sonnenbergs, as saying that if nothing is done to counter the effects of the judgment, the way could be opened for another Fidentia-type plundering of retirement savings. The Financial Services Board (FSB) is planning to move rapidly to counter the SCA judgment by submitting legislative amendments to Parliament. The judgment removes about 1.5m members and hundreds of billions of rands of bargaining council retirement funds from the protection of the Pension Funds Act. According to the report, this loss of protection includes the regulatory protection of the FSB, and the right of fund members to take complaints to the Pension Funds Adjudicator. Jurgen Boyd, the FSB executive in charge of retirement funds, says the FSB is obviously disappointed with the judgment as, in our view, the impact is not in the best interests of present and former members of the bargaining council funds. If the judgment is enforced, the substantial surplus in the funds will be left unregulated, and it is quite likely that former members who contributed to the surplus will be excluded. Further, the funds will be totally unsupervised until, and if, the Pension Funds Amendment Bill is approved by Parliament. Full Personal Finance report SCA judgment