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Pension Funds
Sunday, March 1, 2009
Sliding scale

The Board of Trustees of the Government Employees Pension Fund (GEPF) has approved a pension increase of 9.0% with effect from 1st April 2008 for member pensioners.

The increase will be applied on sliding scale starting at 9.0% for pensioners who retired on or before 1st April 2008 while those who retired after 1st April 2008 will receive 0.75% for each month since date of retirement to 31st March 2009, which is a proportionate share of 9.0%. In respect of those pensioners whose annuities have fallen below the amount paid at retirement  adjusted for full inflation to date, the  annual increase will vary from 9% to a  maximum of 10.5% to compensate for the impact of inflation.
GEPF is the 7th largest pension fund in the world, with 1.1 million contributing members, 303 977 pensioners and more than R700 billion of assets under its management. Section 25 of the Government Employees Pension Law and Rule 23 provides the authorisation by the Board of Trustees for an increase in annuities on a regular basis, within the financial constraints of the Fund and acting on the advice of the Fund’s actuaries.
According to Martin Kuscus, Chairperson of the GEPF Board of Trustees, ”The current global environment has made it difficult for the Fund to afford an increase of 100% of average CPI. However, it is the extra reserves that were set aside during the good times that had made it possible for the Fund to afford 9.0%, which is equivalent to 75% of average CPI. This level of increase is in line with the commitment expressed in Rules of the Fund.”
 

Copyright © Insurance Times and Investments® Vol:22.3 1st March, 2009
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