Finweek English Edition - - Letters - RORY G

DIS­MAY, DIS­BE­LIEF, Amaze­ment. Three words that sum up my feel­ings to­wards your ex­perts in­ter­viewed in re­spect of the pro­posed na­tional pen­sion scheme. The group chief ex­ec­u­tive is def­i­nitely not the right per­son to ask and that “no­gal” of a life in­sur­ance com­pany that might get a slice of this cake!

The ques­tion should rather be put to the or­di­nary man in the street (like me). My payslip for the fi­nan­cial year ended Fe­bru­ary 2007 shows the fol­low­ing to­tal de­duc­tions: Pen­sion 6%; tax 22%; UIF & Group In­sur­ance 2%, Med­i­cal Aid 9%. A to­tal of 39% – there­fore de­duc­tions prior to my take-home pay are al­most 40%!

Now here comes the bal­anc­ing act. I am mak­ing ex­tra pro­vi­sion for re­tire­ment that to­tals 7%, short-term in­sur­ance is 2%, petrol is 4%, mu­nic­i­pal ac­counts plus tele­phones plus food­stuffs are es­ti­mated at 12,5% (VAT is 2% on th­ese three items). A bond re­pay­ment on an av­er­age house is es­ti­mated at 24%. We are head­ing to­wards 90% now. Oh, I al­most for­got about the kids’ ed­u­ca­tion. How much do you want to add on for that?

On pa­per th­ese “ideas” might seem okay, but in prac­tice not. I un­for­tu­nately can­not bud­get for a sur­plus! One should also re­mem­ber that most of th­ese costs are fixed. For ex­am­ple, I can’t chan­nel my RA com­mit­ments into this new scheme, I’m legally bound un­til the age of 55. My an­swer to this scheme is an un­equiv­o­cal no.

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