1. SOCIAL SECURITY AND RETIREMENT REFORM – WHAT CAN YOU EXPECT November 2011

2. LATEST MODEL According to Selwyn Jehoma Deputy- Director of Department of Social Development agreement has been reached on a number of issues around retirement reform (IRF Conference in September 2011).

3. POSSIBLE MODEL 3 Tier Model: Social Assistance Social Security Supplementary Savings

4. SOCIAL ASSISTANCE Social Old Age Grant Paid from general (SOAG) revenue - Disability Grant removal of means Child Support Grant test proposed Foster Care Grant

5. SOCIAL SECURITY Unemployment Insurance (UIF) Contribution Compensation for Occupational % unsure Injuries and Diseases Partial funded Defined Contribution 12% of Benefit Fund R200 000 earnings Disability and Survivor of which 4% is for Benefits risk

6. SOCIAL SECURITY – Partial Funded Retirement Benefit Mandatory contributions to partially fund a basic universal retirement benefit, designed to ensure a minimum level of income protection in old age over and above SOAG Suggest target replacement ratio is 40% of R75 000 with a later 70% target Suggest contribution rate of 12% 4% of the 12% will be for risk cover – benefit not agreed Will consider opt out if properly motivated National State Fund

7. SUPPLEMENTARY SAVINGS Contributions between earnings floor and ceiling Earnings floor – R200 000 Earnings Ceiling – R888 000 Defined Contribution Schemes Accredited Retirement Funds Tax incentives still unclear

8. COMMITMENTS FROM GOVERNMENT Accrued Savings will not be affected No Compulsory transfer of accrued savings

9. UNDECIDED MATTERS The investment strategy Management of the NSSF assets The implementation sequence Whether there should be a single Government department dealing with all aspects of pensions

10. WHAT IS THE FIA DOING Partnered with the FPI Did survey & identified major concerns Proposed focus areas

11. SURVEY RESULTS General mistrust of Government and their ability to manage and run a National Fund Call to clearly establish the Role of the Intermediary in the proposed environment

12. PROPOSED FOCUS AREAS Discuss Role of Government – Tri parte agreement – between Business, Labour and Government regarding management – Clarify the Benefit of the Intermediary – Engage and partner with other organisations to influence on multiple levels