Retirement Reform Snap Survey

1. Retirement Reform Snap Survey Johan Schreuder Investec Asset Management

2. Social Security Fund 1. How would your fund be affected if all the members earning less than R75,000 per year left to join a Social Security Fund offered by the State? Insignificant – very few of our members earn that little We'd have fewer members, but the fund would still serve a purpose We'd have fewer members, so we'd have to question our existence We'd have significantly fewer members, so we'd consider closing

3. Social Security Fund 2. What would you consider doing with the accumulated member benefits of those members who left to join a Social Security Fund offered by the State? Preserve in the existing fund Transfer to the Social Security Fund (SSF) Transfer to the SSF, but allow opt-out to an individual preservation fund Offer various individual preservation funds, allowing members to choose

4. Economies of scale 3. “Most existing retirement funds do not have the necessary size to achieve sufficient economies of scale, which leads to higher costs.” Strongly agree Agree Disagree Strongly disagree

5. Economies of scale 4. If your fund were to close due to insufficient economies of scale, what alternatives would you consider for your members? We'd encourage members to join the Social Security Fund We'd encourage members to join an umbrella fund We'd encourage members to join a retirement annuity fund We'd make no recommendations, allowing members to choose

6. Economies of scale 5. If your fund were to close due to insufficient economies of scale, what would you consider doing with accumulated member benefits? Preserve in the existing fund Transfer to an umbrella preservation fund Transfer to an individual preservation fund We'd make no recommendations, allowing members to choose

7. Increased contributions 6. How will your fund be affected once tax breaks are capped, for example if contributions above R350,000 per year were "after tax"? Insignificant – very few of our members earn that much Some members affected, but their contributions will continue unchanged Some members affected, and they’re likely to reduce their contributions Most members affected, and some are likely to reduce their contributions

8. Increased contributions 7. How will your fund be affected once tax breaks are equalised at 27.5% of the greater of “remuneration” and “taxable income”? Insignificant – our contributions are already close to that level We’ll consider increasing contribution rates, if members can afford it We’ll consider using “remuneration” instead of “pensionable income” We’ll give our members more choice regarding rates and incomes

9. Compulsory preservation 8. Do you think compulsory preservation is a good thing? Yes, members should be prohibited from cashing in benefits Yes, but a limited cash sum should be allowed on retrenchment Yes, but a limited cash sum should always be allowed No, members should always have the option of cashing in 100%

10. Compulsory preservation 9. What preservation options do you currently offer to members? We encourage preservation in the new employer's fund We encourage preservation in a specific individual preservation fund We encourage preservation in a short list of individual preservation funds We make no recommendations, allowing members to choose

11. Compulsory annuitisation 10. Do you think compulsory annuitisation is a good thing? Yes, lump sum benefits should be prohibited Yes, but lump sums should be allowed on death and disability Yes, but lump sums should be allowed on death, disability and retirement No, 100% lump sum benefits should continue to be allowed

12. Compulsory annuitisation 11. What annuity options do you currently offer to members? Our fund pays all its own pensions We've outsourced pensions to a single provider of annuities We offer members a short list of conventional and living annuities We make no recommendations, allowing members to choose

13. Retirement Reform Snap Survey 12. When considering an umbrella fund, retirement annuity fund, preservation fund or living annuity, what is your main consideration? Fees should be as low as possible Members must be offered only quality-approved investment funds Members must have the widest choice of investment funds Members must have access to independent financial advice

14. Retirement Reform Snap Survey Johan Schreuder Investec Asset Management