ANC to pursue prescribed assets plan after poll
The ANC will forge ahead with plans to revive an apartheid-era rule compelling pension funds to plough money into certain government-approved investments, assuming it retains power in upcoming general election.
“Immediately after elections we have to get into it,” said Zuko Godlimpi, deputy chair of the ANC’s economic transformation committee, this week.
Unveiling its manifesto last month, the ANC pledged to transform the financial sector to ensure it makes adequate funds available for the nation’s industrialisation and economic development by introducing prescribed assets. The rule was created in 1956 during white-minority rule to force investment in government bonds but was scrapped decades later. Plans to revive it have been criticised by the pension industry, which fears funds may be threatened if invested in under-performing state-owned enterprises.
The ANC is examining the measure amid pressure to restore its appeal with voters ahead of the 29 May ballot, in which it is at risk of losing its national majority for the first time since taking power in 1994.
Godlimpi dismissed opinion polls suggesting the party’s support will fall below 50% and said there were no discussions about forming a coalition.
Still, the need to revive growth and tackle one of the highest unemployment rates in the world means steps are needed to use the wealth of the country’s financial sector to boost the economy.
He said the range of prescribed assets would go beyond investing in government bonds to support struggling stateowned firms such as Eskom and Transnet, which are in desperate need of funding after years of mismanagement, theft and under-investment.
“The prescribed assets conversation is about rebasing pension fund investment in productive assets,” Godlimpi said, adding there was an assumption that it was all about Eskom and Transnet.
“It is not,” he said. “It is about investing in different classes of assets, including private assets, that are consistent with the industrial output we are seeking.” –