Edition: Jun - Aug 2014
Editorials

FUND ORGANISATION

Ready to bat

The team to get the new industry body up and running is in place. It represents not only a wide cross-section of trade-union trustees and principal officers but also the great bulk of assets under administration in the SA retirement-fund industry.

Batseta, the council for SA retirement funds, is to be formally launched at an inaugural conference in June. That it has reached this stage speaks highly for the consensus built between the Principal Officers Association, whose members are drawn from numerous institutional and corporate funds, and major labour federations Cosatu, Fedusa and Nactu whose relationships might otherwise be factious.

Here, in the same way that a strong trade-union movement can benefit the national economy, they're united around the need for retirement funds to promote defined objectives as a separate and distinctive industry body (TT March-May). A hallmark is that, to be and to be seen as independent of interest conflicts, service providers are specifically excluded from membership.

Ghavalas
Ramputa . . . potent prospects

It's not to say that service providers don't accept the need for such a non-profit organisation. In fact, they welcome it. Support is indicated by the offer of a R5m interest-free loan from the Association for Savings & Investment SA, mainly representative of life offices and asset managers, to help Batseta onto its feet.

But it's an offer that Batseta will prefer to refuse, although it might be inclined during infancy to tap. The funding model is intended to be from membership fees and conference sponsorships, the latter temporarily. Once adolescence is achieved, the plan is to be funded by membership fees only.

This must set off a huge membership drive. Annual fees range from R8 000 for small funds with assets under management of less than R50m, to R100 000 for large funds of over R35bn. As smaller funds consolidate into larger, and particularly umbrellas, solicitation can become so much less cumbersome.

Real benefits are promised. They include networking of funds and fiduciaries; sharing best practices and toolkits; quarterly seminars; participation in industry debates; competency development and training sessions. Overall, such activities are planks for a credible platform from which retirement funds can coalesce and communicate.

Although absorbed into Batseta, there are several ways that the old POA lives on. Its existing administration will provide a full-time secretariat. Its emphasis on professionalization of principal officers, recognised under the national qualifications framework, will continue.

Also, its present board comprises half the Batseta interim board. The other half comprises member-elected trustees.

This interim board is chaired by Isaac Ramputa (the Sasbo deputy general secretary and a trustee on the Cosatu Employee Provident Fund), while the deputy chair is Sibusiso Luthuli (principal officer and chief executive of the Eskom Pension & Provident Fund as well as the POA's former chair). Both were instrumentally involved with Batseta's formation.

The idea is for the interim board to hold office for three years, after which it will be elected by the organisation's members. Although the 18-member interim board is already large, probably reflecting the need for a balanced inclusion of the founding partners, it will additionally seek employer-nominated trustee representation.

The memorandum of incorporation allows for independent directors too. They'll be sought for their business acumen.

Incidentally, there's a reason for the name "Batseta" having been chosen. It's a Pedi word for "council of elders" or "the wise". More significantly, on a rough estimate the funds variously represented appear to comprise perhaps 80% of the assets under administration in the entire SA retirement-fund industry.

WHO'S WHO

Led by Isaac Ramputa as chair and Sbu Luthuli as deputy chair, Batseta's interim board is a carefully crafted and powerful line-up.

Representatives of funds' member-elected trustees:

  • Koos Bezuidenhout (UASA chief executive and Sentinel Retirement Fund trustee);
  • Ernest Hlongwane (general treasurer, Professional Educators' Union);
  • Jan Mahlangu (Cosatu benefits coordinator and Cosatu Employee Provident Fund principal officer);
  • Thulani Mncube (chair, National Public Service Workers' Union);
  • Shadrack Motloung (UASA divisional manager and Sentinel Retirement Fund trustee);
  • Malinge Plaatjie (Nactu national organiser);
  • George Strauss (UTATU SARWHU president and Transnet Pension Fund trustee);
  • Samuel Tsiane (Numsa benefits officer and MIBFA Provident Fund trustee).

Note: UASA is the United Association of SA trade union; UTATU SARWHU is the merged rail and transport union within Fedusa; MIBFA is the Metal Industries Benefit Fund Administrators.

Representatives of principal officers:

  • Johan de Waal (Impala Platinum Pension Fund);
  • Patrick Mayne (Corporate Selection Umbrella Retirement Funds);
  • Ashley Indurjith (Liberty Corporate Umbrella Fund);
  • Madula Mananye (Sentinel Mining Industry Retirement Fund and Mine Employees Pension Fund);
  • John Oliphant (Government Employees Pension Fund);
  • Sipho Sidu (Mineworkers Provident Fund);
  • Lidia Visser (Sasol Pension Fund);
  • Lindy Wingrove-Gibson (City of Johannesburg Pension Fund).

Note: The latter group is the board of the old POA. Although De Waal and Indurjith have retired as principal officers of their respective funds, they've agreed to sit on the Batseta interim board to assist it with their experience through the transition. Oliphant has recused himself from board participation pending the outcome of his GEPF disciplinary inquiry.