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RETIREMENT SAVINGS REFORM: TWO POT SYSTEM IMPLEMENTATION DATE NOT CAST IN STONE
- 26 October 2023
- Parliament
- SA Legal Academy
During a recent meeting of the National Assembly’s Standing Committee on Finance, National Treasury representatives briefed members on their response to input received from stakeholders during parliamentary hearings on the draft Revenue Laws Amendment Bill and draft Revenue Administration & Pension Laws Amendment Bill. These hearings were held on 19 September 2023 – and the briefing on 25 October 2023.
It is clear from page 11 of the presentation document concerned that National Treasury is proposing that two-pot system implementation be deferred to 1 March 2025. Apparently, ‘some commentators’ have argued that more time is required to take all the steps necessary for the system to operate ‘as seamlessly as possible’.
This proposal should be seen in the context of remarks made in a submission from the Congress of South African Trade Unions (Cosatu), welcoming ‘government’s agreement’ that, among other things, ‘1 March 2024 is the target date for implementation, when ‘immediate relief will be available’ – allowing employees ‘access to their savings without having to resign or cash out their entire pension funds’.
The committee is now tasked with considering National Treasury’s proposal for a deferred implementation date, which is one of many in a 66-page presentation document. Should ANC representatives in the committee adopt the proposal (presumably having consulted their alliance partners), it will then need to be endorsed during the ensuing NCOP process.
Against that backdrop, a Business Day article headline ‘Treasury delays implementation of two-pot pension reform’ is premature and somewhat misleading.
- draft Revenue Laws Amendment Bill
- draft Revenue Administration & Pension Laws Amendment Bill
- National Treasury presentation (page 11)
- Cosatu submission (paragraph 2)
- Business Day article
Published by SA Legal Academy Policy Watch