House Chair, the ACDP shares concerns about prescribed assets, and it is deeply ironic that one of the pillars of the apartheid regime could be making a spectacular comeback.
However, it is being sold with a different kind of rhetoric that financial institutions are not doing enough for the developmental state and that they are chasing short-term returns on the Johannesburg Stock Exchange, JSE, and overseas markets instead of investing in long-term infrastructure.
However, one must remember that the money invested in pension funds, whether in the public or private sphere, belongs to ordinary workers who are saving for their retirement - those policemen, teachers, nurses, social workers. They need maximum returns on investment with a minimum risk. Behind every rand invested there is a South African pensioner, a South African worker.
The regime of prescribed assets, as indicated by previous speakers, requiring investors to invest in specified assets, runs a high risk of poor investment returns. The reason for this is that the most likely form of prescription would be to force pension funds ... At the moment it's a choice where you buy. It's a choice for the Public Investment Corporation, PIC, to buy certain bonds. This is an obligatory form to invest a portion of their assets in a predictable list of broken down SOEs such as Eskom, SA National Roads Agency Limited, Sanral, SAA.
We know the remaining defined benefit funds such as the GEPF cannot absorb lower investment returns. This has a negative impact on those pensioners. Just ask the Transnet pensioners. It is estimated that the vast majority of pensioners that are on defined pension funds could have up to a 14% reduction in their pensions should prescribed assets result in compulsory funding of dysfunctional SOEs. This is totally unacceptable and I'm sure that the trade unions, once they grasp the enormity of this, will be opposing this move as well.
We have witnessed widespread looting and plundering of SOEs. Many of us in this Parliament were involved in the Eskom inquiry. We saw the corruption and the state capture. This has resulted in the precarious financial state of these SOEs. Now, for example the new chief executive officer, CEO, of Business Leadership, Ms Mavuso, said you can't steal so much money and think you are going to come back and say, to fix the mess in the SOEs that you have created over 10 years, we are now going to take your pension fund. It is not right. We in the ACDP agree with this position.
We have to protect our pension funds and the trust deficit still has to be restored, and we cannot allow, what other speakers have said is, a theft of pension funds through prescribed assets. The ACDP agrees. [Applause.]