Presentation to Portfolio Committee on Public Service and Administration as well as Performance Monitoring and Evaluation 1 March 2017

GEPF Representatives GEPF Major General Dries de Wit – Vice Chairperson: Board of Trustee and Chairperson: Benefits and Administration Committee Adri van Niekerk – Company Secretary

Agenda Overview of GEPF Operating Model Fund Growth Financial Position Pension Increases Strategic initiatives Current priorities

Overview GEPF is currently the largest pension fund in Africa In terms of Assets: Over R1 638 billion 1.269 m active members 423k Pensioners & Beneficiaries One of the few DB schemes in SA Government is the sponsor Juristic Entity – separate from Government Governed/Managed by a Board of Trustees 16 Member board 8 employer representatives 6 employee representatives 1 pensioner representative 1 forces representative

Operating Model Policy and Strategy Government Employees Pension Fund Investment Mandate Administration Agreement And SLA Public Investment Corporation Government Pension Administration Agency Implementation

Fund Growth

Return on Investments: Annual to 31 March each year

Benefits vs contributions R-billion 2010 2011 2012 2013 2014 2015 2016 Contributions received 36 40 51 49 50 56 60 Benefits awarded 28 30 37 43 58 86 83 Difference +8 +10 +14 +6 -8 -30 -23

Resignation Trend

Financial Position DATE FUNDING LEVEL % VALUATOR 1 May 1996 72.3 Ginsberg, Malan, Carson 31 March 1998 96.5 NBC Employee Benefits 31 March 2000 96.1 31 March 2001 98.1 31 March 2003 89.4 Alexander Forbes Financial Services 31 March 2004 31 March 2006 101.7 31 March 2008 100.0* 31 March 2010 31 March 2012 Towers Watson 31 March 2014 31 March 2016 * The funding level has been determined with reference to the affordable reserves only

Pension Increases – Past 11-years Date of Increase Pension Increase (excluding CPI catch-up) CPI catch-up (percent of CPI) Year-on-year inflation (CPI) Pension increase awarded as a % of inflation 1 April 2006 4.50% 90% 3.35% 134.33% 1 April 2007 5.50% 100% 5.41% 101.66% 1 April 2008 7.00% 8.42% 83.14% 1 April 2009 9.00% 11.76% 76.53% 1 April 2010 5.60% 4.82% 116.18% 1 April 2011 3.58% 125.70% 1 April 2012 4.80% 6.12% 78.43% 1 April 2013 6.00% 107.14% 1 April 2014 5.30% 100.00% 1 April 2015 5.80% 1 April 2016 110.4% 6.6%

Strategic Initiatives 5 Strategic Objectives Improve Benefits Administration (including ICT system modernisation) Improve Member and Beneficiary Communication and Education Improved Investment Monitoring Risk Management Architecture Improve Stakeholder Relations

Priorities from now to March 2017 Asset Liability Model Strategic Asset Allocation Review of PIC mandate Statutory Actuarial Valuation Relevant benefit changes Financial literacy King IV compliance Value added benefits Complaints Handling Mechanism Enhance communication

QUESTIONS?