fundtalk Welcome Call Centre Letters to the editor GEPF S new head of investment and actuarial

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1 fundtalk First Edition 2014 The quarterly newsletter for members of the Government Employees Pension Fund Letters to the editor PAGE 3 GEPF S new head of investment and actuarial PAGE 4 GEPF invests R70-m in agriculture PAGE 5 Welcome Welcome to the first GEPF newsletter of We would like to thank you for your feedback on the previous newsletter and to encourage you to continue sending us your letters to the Editor. Your comments are valued as they help keep us informed about your information needs. We would like to let you know about the imminent move of our Pretoria customer service centre from its current location at 34 Hamilton Street to a new home on the ground floor of the Kingsley Centre at the corner of Steve Biko and Stanza Bopape streets in Arcadia. As we dive further into 2014, we would also like to make sure that you know about two important things. Firstly, rest assured that we are working hard to improve our levels of service delivery to all members, pensioners and beneficiaries, and secondly, that the financial position of GEPF is sound. Our aim is to serve you quickly, efficiently and accurately at all times, as well as to make sure that the pension savings of South Africa s public servants are well managed. In this issue: WE TALK MONEY AND SAVINGS IT S NEVER TOO EARLY TO BE BUDGET-CONSCIOUS Everyone wants to enjoy their golden years, but for many pensioners this is not the case. Research shows that 13% of South Africans have to continue working after their retirement. Read more on page 6 WHAT CONSUMERS SHOULD KNOW ABOUT FINANCIAL SERVICE PROVIDERS RELOCATION OF OFFICES For obvious reasons, it is extremely important to choose a financial services provider who is properly licensed, qualified and experienced. Find out how to make an informed decision on page 10 On 23 April our Pretoria branch will be relocating to the Kingsley Centre on the corner of Steve Biko and Stanza Bopape streets in Arcadia. Find out what services are available at this centre on page 2 Call Centre

2 RELOCATION OF OFFICES As from 23 April, GEPF s Pretoria customer service centre will be relocating from its current location at 34 Hamilton Street to the Kingsley Centre on the corner of Steve Biko and Stanza Bopape streets in Arcadia, Pretoria. Parking access is via Pretorius Street. All pension-related services that were offered at the old location will still be available at our new offices. Issuing benefit statements and estimations of benefits; Reprinting and activating Life Certificates; Assisting with the completion and submission of claim forms for various benefits and products, including: o Spouse s pensions; o Orphan s pensions; o Military pensions; o Special pensions; o Medical subsidies; o Injury-on-Duty benefits; o Funeral benefits; o Divorce benefits; o NSF (Non-Statutory Forces) benefits; and o Purchase of service quotes. Updating personal details of members and pensioners; Providing recognition of transfer letters to brokers; Providing proof of income letters; and Educating members on different types of exits from the Fund, including resignation, retirement, death and contract expiry. You can access these services at any of GEPF s regional and satellite offices located across the country. Please refer to the addresses on the last page of this newsletter. Below is the map to the relocated office. 2 fundnews First Edition 2014

3 LETTERS TO THE EDITOR In the second newsletter for 2013, we asked you, our valued members and beneficiaries, to let us know if you like the newly updated newsletter. We also said that the most noteworthy letter would be published; hence we are pleased to publish the following letter as our first in a new section of the newsletter, Letters to the Editor. We extend a big thank you to everyone who took the time to write to us. Your concerns, compliments and suggestions will be taken into account as we continue to work towards improving the level of service that we offer. Dear Sir/Madam The magnificent new look for the GEPF newsletter. 1. Thank you for your clear explanation regarding the achievements and positions of GEPF locally and internationally, in your well outlined newsletter, second edition of I am very happy and also proud of being a GEPF member, that is because of your Fund s Management Systems and the hospitality of your entire GEPF staff. 3. I attended your road-show held four months ago at the University of Zululand, I was fully satisfied with all your explanations in your presentation. 4. May I suggest that such road-shows be held periodically because they are such informative eye-openers to all of us as GEPF members and non- GEPF members. 5. I appreciate your modern technological innovations regarding SCAN QR Code, though this insert is more meaningful to computer literate GEPF members. 6. May I also suggest that the editor must also provide more lessons in this regard in the future editions of the newsletter Fundtalk. 7. I also appreciate this editorial initiative of readers comments and competitions in the form of give-aways. 8. Lastly may I wish a Merry Christmas and prosperous new year to all of us as one family that is, the members and the staff-personnel of GEPF Scheme. Thank you, Your faithful and loyal GEPF member Dosini, Bongani Isaac. Please send us your contributions for the coming newsletters. We value your opinions and suggestions which allow us to improve our communication to you. Please send them to: The Editor, GEPF Communication, Private Bag X63, Pretoria, fundnews First Edition 2014

4 GEPF S NEW HEAD OF INVESTMENT AND ACTUARIAL Hemal Naran joined the GEPF on 6 January 2014 as its Head of Investment and Actuarial Services. Hemal holds a Bachelor of Commerce degree in Actuarial Science and Insurance and Risk Management from the University of the Witwatersrand and has more than 15 years experience in the investment industry. Over the past few years he has managed investments for one of the largest internally managed UK pension funds. This entailed formulating and managing the pension fund s alternative investment portfolio, and diversifying the fund s investments from its traditional base of public equities and bonds to a range of alternative asset classes, including private equity, infrastructure, natural resources, timberland, insurance-linked securities and hedge fund strategies. Hemal Naran Prior to this, Hemal worked in the investment advisory business of HSBC in London, advising institutional investors on various aspects of setting and managing investment strategy, including consulting to various global investment managers on the creation of diversified growth funds. Hemal, who was born in Makhado and grew up in Durban, is married with two children. He believes that the role of a leader is to find solutions to challenges, strive to make a positive contribution and seek to create the opportunity to build a better business. He defines the qualities of good leadership as honesty, communication, commitment and the ability to be rational. 4 fundnews First Edition 2014

5 GEPF INVESTS R70-MILLION IN AGRICULTURE GEPF, through its investment manager the Public Investment Corporation (PIC), has invested R70-million in Just Veggies, a vegetable processing company in Coronation Vryheid, KwaZulu-Natal (KZN). In February 2012 Just Veggies acquired BioSwiss Industries (Pty) Ltd, which at the time was the largest producer and processor of organic vegetables in the country. BioSwiss, established in 2003, supplied organic frozen products on a large scale, initially focusing on green beans for the export market, but eventually diversifying its product offering to include broccoli, cauliflower, carrots, corn and gem squash. The target market expanded from frozen to include fresh markets, locally and internationally. BioSwiss worked with the community farmers who had received their land as part of the government s Land Restitution programme. It entered into joint ventures with communities to secure product supplies and oversee the planting and operations of the farm as a strategic service provider. According to the Department of Local Government, the town, with a population of , has an estimated poverty rate of 34% and high levels of unemployment - which would have been aggravated by the closure of BioSwiss had Just Veggies not acquired the company. GEPF s investment will go a long way towards creating more than new jobs and will make a valuable contribution to rural development, the farming sector and food security in the community. This investment shows GEPF s commitment to investing in developmental projects that will benefit our members and pensioners in the long term and which address some of the challenges they face. GEPF plays a significant role in reshaping not only South Africa s but Africa s future through investing in areas that have a positive impact on economic and social enterprises. 5 fundnews First Edition 2014

6 It s never too early to be BUDGET-CONSCIOUS The earlier you start practising sound money management, the greater the chances that you will be financially independent when you retire. It all starts with budgeting and financial discipline. Everyone wants to enjoy their golden years after retirement, which should be a time to reap the rewards of your years of hard work. However, for many people this is not the case. Research conducted by the Financial Services Board shows that 13% of South Africans have to continue working after their retirement while 10% are dependent on friends and family. (Source: Financial Literacy in South Africa - Results of a baseline national survey) Every year when you receive a salary increase, you might be tempted to increase your spending. However, this is not wise as your living expenses (such as the cost of fuel, food and electricity) also increase each year. A budget is a detailed plan of how you are going to spend your income (your salary, income from investments, etc.) and includes all your expenses. Before you start drawing up your budget you need to list all your needs and wants. Needs are things you cannot live without, such as food, clothing, shelter, electricity (power), transport and medical cover. Wants are nice-tohaves such as take-aways, a fancier house, designer clothing, etc. A lways start with paying for your needs, then saving. When your needs and savings are taken care o f, lo o k a t satisfying your wants. 6 fundnews First Edition 2014

7 Here are some TIPS to follow when drawing up your budget: 1 2 Add up your monthly income from all sources Add up all your monthly expenses 3 Compare your income and expenses to determine if you are overspending, under spending or breaking even Save any money left Plan to reduce or eliminate any overspending Plan ahead ALWAYS BE HONEST AND STICK TO YOUR BUDGET! Should you be overspending it is vital to balance your budget as soon as you can. This means taking another look at where you are spending too much. Are all your needs actual needs or are they things you think you need? Look at where it is possible to cut back - perhaps by changing your shopping habits. For example, you could start shopping at supermarkets where the prices are lower or buy groceries in bulk with other family members and split the costs. Take a good long look at your funeral policies. How many do you have? You only need one and it should be from an authorised financial services provider. Making sure you manage your money ef fectively is vital to ensuring your hard-earned salary will cover your needs for today and leave enough over for your retirement Written and contributed by: Tammy Peyper, Manager: Consumer Education Department, Financial Services Board 7 fundnews First Edition 2014

8 LOOKING AFTER YOUR SPOUSE WHEN YOU PASS ON: YOUR SPOUSE S PENSION IS FOR LIFE As per the Fund Rules, GEPF will continue to look after you and pay your pension when you retire. After you have passed on, we will look after your spouse. When you, a married GEPF pensioner, pass away, your spouse will receive a share of your monthly pension. This is called a spouse s pension. On your retirement, you have the option to choose whether your spouse should receive 50% or 75% of your pension at the time of your passing away. If you choose that your spouse should receive 75%, you will receive a smaller monthly pension or lump sum on retirement. Some pensioners have more than one spouse; GEPF will continue to look after all of your spouses: if you pass away with more than one spouse, your spouse s pension will be divided equally among the spouses who are left behind. Most importantly, the spouse s pension is a lifelong pension. This means that GEPF will continue to pay it to your spouse or spouses until they pass away, even if they choose to remarry after you have passed on. How can your spouse access the spouse s pension? When you pass away, your spouse can fill in the Application for Spouse s Pension form (Z143) and submit it to GEPF, along with the following documents: A certified copy of their identity document (ID) (certified within the last six months). A Banking Details form (Z894). A certified copy of your death certificate. A certified copy of your ID or passport and confirmation of your death as issued by the Department of Home Affairs. A certified copy of your marriage certificate (religious, customary union or civil union) as issued by Home Affairs. Alternatively, your spouse can provide proof of marriage by means of a certified copy of a customary union certificate, Hindu certificate or Lobola affidavit and confirmation of the customary union by representatives from both of your families. 8 fundnews First Edition 2014

9 GEPF CAN HELP YOU PAY YOUR TAX EVERY MONTH WITH THE VOLUNTARY TAX DEDUCTION If you receive a GEPF pension and an income from an employer or from somewhere else, the money that is deducted monthly from each income source for tax might not be enough to cover all of the money that you need to pay to SARS for the year. This is because SARS calculates the amount of tax that someone must pay by adding together all of the person s income and then using the final amount to find out how much must be paid according to their tax tables. This means that the more a person earns, the higher their rate of tax will be and the more they will need to pay in. HOW DOES THE TAX WORK? If you are only receiving an income from GEPF or from another employer, the amount of tax paid will, most likely, be the same as that which you owe. This means that you will not have to pay any money in when your tax is reconciled each year. However, if you are receiving income from more than one source and each pays money to SARS on your behalf for tax, you might be paying less than you need to because the combined income may put you into a higher tax bracket. This will mean that you will have to pay in more at the end of the tax year when you submit your tax return and this can be a burden on you. WHAT CAN YOU DO TO RESOLVE THE PROBLEM? To help you avoid this situation, you can make additional voluntary tax payments each month. This means that you can ask GEPF and/or an employer or other source of earnings to deduct more tax from your income each month. This will help you to reduce the amount of tax you will need to pay in at the end of the year when you submit your tax return. HOW DOES IT WORK? The first step is to calculate the extra amount you will need to pay in each month in order to make sure that you cover all of the tax that you owe to SARS for the year. SARS will be able to assist you in this regard. You can then choose either to ask your employer and GEPF to deduct an amount from your income every month for tax, or you can ask one source of income, for example GEPF, to deduct the entire extra amount, with the other deducting the normal amount. 9 fundnews First Edition 2014

10 WHAT DOES GEPF NEED FROM YOU? In order for GEPF to pay more money to SARS on your behalf as a voluntary extra payment, a letter must be sent to the GEPF Tax Unit with all of your details, especially your pension or CP number. The letter should clearly state what extra amount (how much) you would like deducted from your pension each month to pay to SARS. Once GEPF has received this letter, voluntary tax deductions will be made every month to SARS until you request that the deductions be stopped. This means that you will need to send GEPF another letter instructing them to stop the extra deduction when you want the extra payments to come to an end. Please take note: This voluntary tax deduction does not reduce any debt already owed to SARS. It is only for current or future tax and not for past debt. WHAT CONSUMERS SHOULD KNOW ABOUT REPRESENTATIVES OF FINANCIAL SERVICE PROVIDERS (BROKERS) On retiring, many people look for someone who can give them reliable, expert advice on how to handle their pensions and investments. For obvious reasons, it is extremely important to choose a financial services provider who is properly licensed, qualified and experienced. In South Africa, all Financial Services Providers (FSPs), known as brokers, must be authorised with the Financial Services Board (FSB). This means that they must have a licence with the FSB in terms of the Financial Advisory and Intermediary Services (FAIS) Act. The purpose of the FAIS Act is to protect consumers of financial services and to professionalise the financial services industry. To achieve this, the FAIS Act imposes certain requirements on providers of financial services to ensure that consumers receive proper financial advice and that they are provided with sufficient information to make informed investment decisions. What should consumers check? Consumers should check that the person providing the advice and/or rendering the intermediary service is either an FSP or a representative of an FSP. You should also check that the person is authorised to render financial services in respect of the financial product he or she wants you to invest in, buy or sell 1 Request a letter of authority confirming that he or she is allowed to sell financial products on behalf of the company and that the company takes responsibility for the actions of the broker. 10 fundnews First Edition 2014

11 2 Phone the Financial Services Board s call centre on / and ask the operator to check whether the person you are dealing with is allowed to sell financial products and whether he or she is authorised to render financial services in respect of the financial product concerned. You can also check on the website of the FSB: What happens if a consumer is not satisfied with the advice or the service he or she receives? Try to resolve the complaint with the company that employed the broker. If the complaint is not satisfactorily resolved, you may lodge a complaint with the O m b u d f o r Fi n a n c i a l S e r v i c e s P r ov i d e r s (FA I S O m b u d) o n t h e f o l l o w i n g c o nt a c t d et a i l s: Ombud for Financial Services Providers (FAIS Ombud) PO Box Lynnwood Ridge 0040 Tel: Fax: (012) info@faisombud.co.za If you are still of the view that the broker is not fit and proper to be in the financial industry, you can refer the matter to faiscomplaints@fsb.co.za for further investigation. Written and contributed by: Financial Services Board VISIT GEPF S WEBSITE AND WIN! We would love to know what you think of our website. Is it user friendly? Can you find what you are looking for? Do you like the way it looks? There are GEPF goodie bags to be won for the best comments and suggestions. your feedback to: communications@gepf.gov.za You can also tweet your comments #WebsiteCompetition Or let us know by sending a letter to: Website Competition GEPF Private Bag X63 Pretoria 0001 Closing date: 23 May Follow us on Scan here 11 fundnews First Edition 2014

12 CONTACT DETAILS Toll free number: Fax number: (012) Website: Postal address: GEPF Private Bag X63 Pretoria 0001 Provincial Offices Gauteng (as of 23 April): Eastern Cape: Free State: KwaZulu-Natal: Limpopo: Mpumalanga: North West: Northern Cape: Western Cape: Ground floor, Kingsley Centre, corner Steve Biko and Stanza Bopape streets, Arcadia, Pretoria No. 12, Global Life Office Centre, Circular Drive, Bhisho No. 2 President Brand Street, Bloemfontein Third floor, Brasfort House, 262 Langalibalele Street, Pietermaritzburg 87(a) Bok Street, Polokwane 19 Hope Street, Ciliata Building, Block A, ground floor, Mbombela Mmabatho Mega City, Office No. 4/17, ground floor, Entrance 4, Mahikeng 11 Old Main Road, Kimberley 21st floor, No. 1 Thibault Square, Standard Bank Building, Long Street, Cape Town Satellite Offices Johannesburg: Port Elizabeth: Mthatha: Durban: Second floor, Lunga House, 124 Marshall Street, (Corner Marshall and Eloff Gandhi Square Precinct), Marshalltown Ground floor, Kwantu Towers, Sivuyile Mini-Square, next to City Hall Second floor, PRD Building, Sutherland Street Eighth floor, Salmon Grove Chambers, 407 Anton Lembede Street Disclaimer The information provided in this newsletter is protected by applicable intellectual property laws and cannot be copied, distributed or modified for commercial purposes. While every effort has been made to ensure that the information contained herein is current, fair and accurate, this cannot be guaranteed. The use of this information by any third party shall be entirely at the third party s discretion and is of a factual nature only. The information contained herein does not constitute financial advice as contemplated in terms of the Financial Advisory and Intermediary Service Act, GEPF does not expressly or by implication represent, recommend or propose that products or services referred to herein are appropriate to the particular needs of any third party. This newsletter is for information purposes only. Please note that if the content of the newsletter conflicts with the Rules of the Fund, the Rules shall prevail. GEPF does not accept any liability due to any loss, damages, costs and expenses, which may be sustained or incurred directly or indirectly as a result of any error or omission contained herein.