What happens if a member dies within five years of retirement?

Active Government Employees Pension Fund (GEPF) members are encouraged to inform their families about the fund’s five-year guarantee period rule.

The Government Pensions Administration Agency (GPAA), which administers pensions on behalf of the GEPF, says it is important that in the event of the death of a GEPF member, their loved ones know what to do.

A GEPF member’s annuity is guaranteed for 60 months after retirement. The five-year guarantee rule prescribes that should a member pass on within five years of retirement, the GEPF will pay the balance of the annuities that were guaranteed for five years to the eligible spouse and/or beneficiaries of the deceased pensioner.

To put it simply, if a member dies 12 months after retiring and received R20 000 in pension a month, the remaining 48 months’ payments will be paid out as a lump sum: 48 months x R20 000 = R960 000.

Thereafter, the spouse will receive a smaller monthly spousal pension.

Pension for life

GEPF members who have under 10 years of service receive a once-off lump sum on retirement, while those with more than 10 years of service receive a once-off payment and a monthly pension (or annuity) for the rest of their lives.

Dr Rakgwatha Mokou, Manager of Media and External Stakeholder Relations at GPAA, explains in more detail. “If a pensioner is still alive after the first five years of retirement, the fund continues to pay the monthly pension, but not from the pensioner’s contributions, which would have been depleted. This is one of the non-contributory benefits to GEPF members,” says Mokou.

If a member passes on after five years of retirement, there will be no five-year balance payable. This is because the member’s funds would have been depleted, says Mokou. In this case, only the monthly spousal pension will be paid.

He cautions that the five-year rule does not apply to active members, but only to those who have retired. However, should the member pass on while still in active service, beneficiaries will receive death benefits.

Mokou urges members to complete a nomination form (WP102) while in service to