Latest news with #Saftu
The Citizen
03-07-2025
- Business
- The Citizen
Two-pot pension system disburses billions, but concerns linger
The two-pot system has two components – one for savings and the other for retirement. Many concerns over the two-pot retirement payouts have not yet been addressed, even as the system forges ahead with almost R60 billion disbursed to claimants since September last year. Prof Lucien van der Walt, director of Neil Aggett Labour Studies Unit at Rhodes University, said the system is a positive development, but it allows a small amount to be accessed annually. 'Given the situation that many working-class people face, it's better than being trapped in a downward spiral of financial instability and losses,' he said. Small annual access seen as both a benefit and limitation 'Previously, many people quit their jobs so that they could access their retirement funds, often leaving them broke later, and on the small government old age pension system.' Van der Walt also highlighted as one of the negatives of the system the fact that the money would be taxed on withdrawal at the usual tax rate. 'You will lose some of the money, even though it is your money. This is not the same as withdrawing cash from an ATM,' he said. However, trade union federation Cosatu described the pension fund reform as 'among the most transformational since the democratic breakthrough of 1994'. More than R57 billion has been paid to more than 3.5 million workers since the roll-out of the two-pot pension system. 'Fund operators reported unprecedented numbers of calls and applications from workers. While some funds' systems were initially overwhelmed, most coped well, with Cosatu and its affiliates intervening where workers experienced challenges,' said Cosatu's parliamentary coordinator Matthew Parks. Cosatu praises system rollout but slams employer defaults While the ANC-aligned federation praised the 'excellent progress' made in the system payouts, it objected to some employers and municipalities that had failed to pay over workers' pension contributions. ALSO READ: Two-pot retirement system: Almost 4 million withdrawals close to R57 billion Parks said some 7 700 employers had been fingered as culprits, with the largest numbers of such cases reported in the municipal, security and cleaning sector. He said Cosatu was 'deeply angered by over 7 700 employers who, through this process of providing relief to workers, have been exposed for having failed to pay over workers' pension contributions'. He said this is fraud and theft and must be dealt with by law enforcement agencies. 'Cosatu, with National Treasury and the Financial Sector Conduct Authority, continues to intervene with such delinquent employers to ensure this criminality is dealt with,' said Parks. Saftu raises alarm over lack of access before retirement But the South African Federation of Trade Unions (Saftu), while welcoming the system, rejected the rules surrounding the second pot – the retirement component. 'The two-pot pension reform could have been progressive if it were not for the rules for the second pot, which require workers to access it only at the retirement age,' said Saftu in a statement. 'This means a worker who is dismissed, retrenched or who resigns, will not access their pension fund in a lump sum until after they reach retirement age.' How the two-pot system works The two-pot system has two components – one for savings and the other for retirement. This meant 33% of the contributions would go into a savings pot and be accessible for withdrawal once a year, while 66% would go into the retirement pot, where it would be kept in the fund until the employee reached retirement age. ALSO READ: Poor financial literacy about retirement costing SA and consumers millions This is designed to ensure employees will be able to access their retirement savings to provide some financial relief, according to the fund operators. 'Reduced standard of living' Some regard this as a great idea in light of the ongoing economic crisis and financial strain that is burdening workers. The African Christian Democratic Party had cautioned workers that withdrawals from the savings pot should only be made for emergencies. 'It should also be noted that this withdrawal will be subject to tax and other administrative costs, resulting in one receiving less than what was applied for,' said the party. 'Additionally, a withdrawal from the savings pot will reduce the final total amount available at retirement and may result in a reduced standard of living.' Fund operators and watchdogs urge caution Last year, retirement fund operator Allan Grey told its clients that the idea behind the new two-pot retirement savings system is to promote the preservation of retirement fund investments until members retire. While Old Mutual, in one of its myth-busting explanations, said the system would be automatic for all retirement fund members. But Corruption Watch cautioned about the potential for fraud and corruption related to the two-pot retirement system, particularly regarding cybersecurity vulnerabilities and the risk of scams. The corruption buster encourages vigilance, reporting suspicious activities, and verifying communications from retirement funds. NOW READ: Dipping into retirement funds could cost more than you think
The Citizen
18-06-2025
- Business
- The Citizen
Standard Bank's ‘disproportionate' attempt to foreclose on Vavi's home fails
Bank was also claiming more than R160 000 in legal costs from Vavi and his wife – twice the value of their current repayment arrears. Saftu General Secretary Zwelinzima Vavi and his wife can stay put, for now. Picture: Neil McCartney / The Citizen Standard Bank has failed in its attempt to obtain authorisation for the foreclosure of a mortgage bond it granted over the Sandton primary residence of South African Federation of Trade Unions (Saftu) General Secretary Zwelinzima Vavi and his wife Noluthando. The judgment highlighted the high legal costs that result from mortgage bond arrears and foreclosure, with the bank claiming more than R160 000 in legal costs from the couple – twice the value of their current mortgage bond repayment arrears. Judge Stuart Wilson said Standard Bank had placed nothing before him explaining why execution against the Vavis' home is a proportionate means of recovering the arrears. He postponed the application brought by the bank indefinitely on Tuesday and ordered that each party should pay its own costs. Wilson said a court asked to authorise foreclosure against a debtor's primary residence must be satisfied that to do so would be proportionate. Read more The Art Lab: A space for collaboration, experimentation, and creativity at Nelson Mandela Square He added that foreclosure is generally proportionate when there is little meaningful prospect of the debt secured against the residence being recovered in some other way – and when the interest of the creditor in obtaining payment outweighs the interest of the debtor in retaining ownership of the home. Standard Bank was seeking a money judgment and leave to execute it against the primary residence of the couple, whose indebtedness arose from a mortgage bond passed over the property. ALSO READ: Court rules in favour of clients in Standard Bank home loan dispute Steps taken to reduce arrears – judge Wilson said the fact that the property is, on the face of it, an expensive dwelling in a well-heeled suburb makes no difference to the fundamental inquiry – but cases in which it would be disproportionate to authorise execution of a proven mortgage debt against such a property are likely to be rare. However, he said: 'This is such a case. The Vavis owe around R1.68 million on their bond, and are in arrears to the tune of just over R85 000 – or around four months' worth of instalments. 'The arrears were accumulated around three years ago, and since then the Vavis appear to have serviced their bond punctiliously while taking steps to reduce their arrears from just under R170 000 when the application was instituted to around R85 000 today. 'The latest home loan statement filed shows around 18 months of apparently perfect adherence to the Vavis' obligations to pay their monthly instalments.' ALSO READ: Class action suit shows banks sell repossessed houses for cents in the rand Legal costs and arrears 'separate issues' Wilson added that Standard Bank claims over R160 000 in legal costs against the Vavis – and it is apparent from the affidavits that the bank has tied the resolution of this dispute to the settlement of those costs. 'It is at least possible that the Vavis have balked at paying legal costs of twice the value of their current arrears. 'It seems to me that the Vavis would be entitled to rehabilitate the loan agreement by paying their arrears and then debating the reasonableness of those costs with Standard Bank as a separate issue, but I cannot say why the arrears have not been settled. 'Nevertheless, in the absence of more information, I cannot presently conclude that foreclosure against the Vavis' home is a proportionate means of liquidating their arrears.' Although the judge postponed the application sine die (indefinitely), Wilson said the bank may renew the application if and when it presents evidence that foreclosure would be proportionate. ALSO READ: What to do if you start falling behind on your home loan Financial woes The Vavis have been in the news for other alleged arrears related to their Sandton home. City Press reported in February 2024 that Vavi and his wife had been taken to court by the City of Johannesburg (CoJ) Metropolitan Municipality for allegedly failing to pay more than R400 000 in outstanding levies for their home. It said the CoJ was seeking an order from the High Court in Johannesburg that would compel the couple to pay an amount stipulated as R433 493 after they had applied to the municipality for provision. The article said it had previously reported on their financial woes, which it claimed began in 2022 when Standard Bank applied for a writ of execution on the same house after accusing them of non-payment. It subsequently reported that Noluthando Vavi said they only became aware of the court papers when inquiries were made by City Press about their home, which they bought for R2 million in 2008. It is unclear what happened to the CoJ's arrears high court application. This article was republished from Moneyweb. Read the original here.
Daily Maverick
04-06-2025
- Business
- Daily Maverick
‘Enough is enough' – Saftu threatens mass protests over NMB public fund mismanagement
The South African Federation of Trade Unions in Gqeberha said on Wednesday that it was 'deeply outraged, though not surprised' by the Auditor-General's damning findings on the Nelson Mandela Bay metro. The organisation has threatened mass action as a response to 'incompetence, mismanagement and a total disregard for working-class residents'. The South African Federation of Trade Unions (Saftu) has threatened the Nelson Mandela Bay municipality with mass action to protest against what it has called the current coalition government's 'incompetence, mismanagement and total disregard for working-class residents'. Saftu secretary Mziyanda Mcanda said a meeting had been held with the Speaker of Council, Eugene Johnson, who had promised to address their concerns. But, he added, the latest Auditor-General's report on Nelson Mandela Bay was deeply shocking. 'The report confirms what workers, the unemployed and the poor have long known — that this municipality is being run into the ground by incompetence, mismanagement and a total disregard for working-class communities,' said Mcanda. Grant spending Despite being the only metro to receive the Regional Bulk Infrastructure Grant (RBIG) — a critical intervention aimed at improving bulk water and sanitation infrastructure — the municipality underspent the grant by 41%, according to this report. 'This is criminal negligence in a city facing chronic water insecurity and failing sanitation systems. Communities in KwaZakhele, Motherwell and Chatty continue to suffer water cuts and sewerage overflows, while the money meant to fix these issues lies idle due to so-called implementation challenges,' Mcanda said. 'Even more damning is the fact that 67% of senior management posts are vacant, the highest of any metro in the country. This leadership vacuum reflects a collapsing state — one that is either unwilling or unable to deliver even the most basic services. Workers inside the municipality are overburdened, demoralized and left without leadership or direction, while politically connected elites scramble for tenders and positions,' he added. Motherwell housing project He highlighted the plight of residents who had been promised housing through the Motherwell NU30 housing project, calling it 'another insult to our people'. 'The Auditor-General confirms that houses were approved for handover despite structural defects and no electricity. These are not homes; they are shells. People are being handed keys to hardship, not dignity. This is a systemic crisis. It cannot be reduced to administrative failures; it is the direct result of a capitalist state that serves private profiteers and political elites, not the working class. While public money goes unspent or wasted, our communities suffer hunger, evictions, floods and disease,' he said. Mcanda said the organisation wanted the urgent filling of senior vacancies with competent, accountable and community-oriented personnel. 'No more cadre deployment for corruption,' he added. They are also demanding the institution of a forensic investigation into the RBIG underspending and NU30 housing project, 'with consequences for those responsible'. He said they also wanted an emergency summit of affected communities, labour and civil society 'to chart a democratic, people-centred turnaround strategy for the metro'. Saftu's concerns were also echoed in a letter by faith leaders in the metro which was sent to President Cyril Ramaphosa in May. 'Enough is enough. We will not allow this municipality to continue failing our people. If these demands are not urgently addressed, Saftu Gqeberha will mobilise for mass action,' Mcanda added. DA says budget is morally indefensible Meanwhile, the Democratic Alliance (DA) said the proposed 2025/26 Nelson Mandela Bay budget was unrealistic and morally indefensible, as it passes the buck to ratepayers to 'fund the mismanagement of our inept ANC-led municipality'. In a pre-budget press conference held on Wednesday, Odendaal said the metro was haemorrhaging millions of rands due to its inability to spend grant funding. The budget will be discussed in a council meeting on Thursday. 'Over the last two financial years, the ANC-led administration's dysfunction has lost a staggering R900-million in grant funding meant to build roads, and water and electricity infrastructure. 'This inability to spend is a crisis and, as of April this year, the municipality had only spent 38% (R752-million) of its R1.934-billion capital expenditure budget. 'Against the backdrop of this continued mismanagement, the tariff increases in the budget are morally indefensible. Imagine losing money and then asking ratepayers to balance the books,' Odendaal added. He further said that the budget as presented to council was only funded because it assumes a 76% collection rate while the average collection rate for the 2024/2025 financial year is 72.15%. 'Ward-based budgets are also a major concern as very little budget has been made available for certain wards. The DA believes every community has the right to a fair allocation of resources,' he said. Executive Mayor of Nelson Mandela Bay Municipality, Cllr Babalwa Lobishe, held a mayoral member committee meeting on Wednesday to address the findings of the Auditor-General, and stressed the critical importance of enhanced planning and accountability within all departments. She promised last week that she would address the vast underspending of Treasury grants at the city council meeting on Thursday. 'By Monday, a consultative report must be ready for virtual discussion to guide Wednesday's submission. With only three months left until the Auditor-General's review, we cannot afford to be caught off guard,' she said. Departments have also been directed to review current contracts, identify possible risks and define clear actions to avoid repeated deviations or contract extensions. 'Changing our culture doesn't take time; it takes consistency. If we focus on efficient, daily execution, our teams will adapt and we will start seeing real progress,' she concluded. DM
IOL News
13-05-2025
- Business
- IOL News
Job losses loom as Saftu and Cosatu highlight South Africa's manufacturing crisis
The South African Federation of Trade Unions (Saftu) and Congress of South African Trade Unions (Cosatu) are concerned about the loss of jobs as the manufacturing sector continues to decline. Image: Supplied The SA Federation of Trade Unions (Saftu) and the Congress of South African Trade Unions (Cosatu) have raised concerns about job losses amid a decline in the country's manufacturing sector. This was after Statistics SA (Stats SA) released data showing that manufacturing production decreased by 0.8% in March compared to the same period last year. This marked the fifth consecutive month of decline in industrial activity. The largest negative contributors were petroleum, chemical, rubber and plastic products and electrical machinery. On a quarterly basis, production fell by 2.3% in the first quarter of 2025 compared to the fourth quarter of 2024. It also decreased by 2.2% on a monthly basis - March 2025 compared to February 2025. Saftu attributed the decline to neoliberal policies, insufficient investment and an extractive economic structure. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ The union warned that this would be worse as the expanded definition of unemployment, which includes those discouraged from seeking employment, remained unchanged at 41.9%. Saftu said also this confirms a long-term trend of deindustrialisation. Since 1994, Saftu said, manufacturing's share of Gross Domestic Product (GDP) has declined from 22% to just over 11% while capacity utilisation has dropped from 82% to 65%. The union pointed to a decline in investment, both public and private, as a key factor in the manufacturing sector's struggles. Cosatu added that it was concerned about the loss of jobs. It said the Gross Fixed Capital Formation was 14.93% of the GDP in 2023, which is down from 20% in the early 2000s. It said the private sector investment was 12.37% of the GDP, while public sector investment was just 2.5%. Saftu's general secretary, Zwelinzima Vavi, said these figures confirm that both the State and private capital have retreated from investing in the productive economy. 'Unless state policy changes, we can anticipate even worse bouts of deindustrialisation, because of the steel industry's crisis. "Already the crash of steel output from a peak of nine million tonnes a year to around four million tonnes has required an ongoing bailout of ArcelorMittal foundries that were due to close,' he said, warning that US President Donald Trump's decision to impose tariffs on imports would also worsen the situation. Cosatu called on the government to seek alternate trading partners to counter the impact of US tariffs. 'Simultaneously, more must be done to ensure Eskom is able to provide reliable and affordable electricity, Transnet can transport our mining, manufacturing and agricultural goods, and Metrorail workers to their destinations on time and at affordable prices. Municipalities must be fixed to provide the basic services the economy depends on. 'A new mass industrial financing programme, mobilising public and private resources must be put in place to support the reindustrialisation of the economy and in particular export and jobs intensive sectors,' said Cosatu. Cape Argus
IOL News
12-05-2025
- Business
- IOL News
Manufacturing in crisis: Saftu and Cosatu warn of job losses amid declining production
The South African Federation of Trade Unions (Saftu) and Congress of South African Trade Unions (Cosatu) are concerned about the loss of jobs as the manufacturing sector continues to decline. Image: Supplied The South African Federation of Trade Unions (Saftu) and the Congress of South African Trade Unions (Cosatu) have raised concerns about job losses amidst a decline in the country's manufacturing sector. This was after Statistics South Africa (Stats SA) released data showing that manufacturing production decreased by 0,8% in March compared to the same period last year. This marked the fifth consecutive month of decline in industrial activity. The largest negative contributors were petroleum, chemical, rubber and plastic products and electrical machinery. On a quarterly basis, production fell by 2,3% in the first quarter of 2025 compared to the fourth quarter of 2024. It also decreased by 2,2% on a monthly basis - March 2025 compared to February 2025. Saftu attributed the decline to neoliberal policies, insufficient investment and an extractive economic structure. The federation called for policies that prioritise job creation and industrial development. On the other hand, Cosatu said it was concerned about the loss of jobs. The union warned that this would be worse as the expanded definition of unemployment, which includes those discouraged from seeking employment, remained unchanged at 41,9%. Saftu said also this confirms a long-term trend of deindustrialisation. Since 1994, Saftu said, manufacturing's share of Gross Domestic Product (GDP) has declined from 22% to just over 11% while capacity utilisation has dropped from 82% to 65%. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ The union pointed to a decline in investment, both public and private, as a key factor in the manufacturing sector's struggles. The federation added that Gross Fixed Capital Formation was 14,93% of the GDP in 2023, which is down from 20% in the early 2000s. It said the private sector investment was 12,37% of the GDP, while public sector investment was just 2,5%. Saftu's general secretary, Zwelinzima Vavi, said these figures confirm that both the State and private capital have retreated from investing in the productive economy. Vavi said if aluminum and steel had been factored in, the deindustrialisation rates would be worse. 'Unless state policy changes, we can anticipate even worse bouts of deindustrialisation, because of the steel industry's crisis. Already the crash of steel output from a peak of nine million tonnes a year to around four million tonnes has required an ongoing bailout of ArcelorMittal foundries that were due to close,' he said, warning that US President Donald Trump's decision to impose tariffs on imports would also worsen the situation. 'Given the extreme animosity to South Africa from Trump and a new group of paleo-conservative imperialist powerbrokers in Washington, due to our government's (correct) labeling of Israel as genocidal and pursuit of affirmative action and land reform, we may anticipate far worse to come. There will likely be no renewal of the Africa Growth and Opportunity Act (AGOA) and intensified punitive tariffs on all exports are certain once the 90-day pause on South Africa's 32% tariff penalty is lifted in July. ' 'South Africa cannot overcome its crisis through austerity or corporate appeasement. Both the private and public sectors have withdrawn from investment. The time has come for a bold shift to a developmental state that leads investment, reindustrialises the economy, and places public goods over private profits. Power concedes nothing without a struggle — the working class must mobilise for a new economic future,' said Vavi. Cosatu called on the government to seek alternate trading partners to counter the impact of US tariffs. 'But at the same time ensure the continuation of AGOA or a similar trade agreement between the USA and SA that increases trade and investment opportunities between both countries,' said spokesperson Zanele Sabela, who added that South Africa also needs to accelerate the role in the African Continental Free Trade Area (ACFTA) to unlock trade with Africa.
