Ruined pensioners turn to Thuli

14 October 2015 - 02:09 By Graeme Hosken

Thousands of public servants are to ask the public protector to help them avoid being financially ruined by the Government Employee Pension Fund. The Times revealed last week that nurses, teachers, police officers, soldiers and other government workers who had divorced were being forced into crippling debt by the fund.The fund has, since 2012, held members liable for money paid from their pension benefit to a former spouse by court order.An amendment to the Pension Fund Act in 2007, introduced to give legislative force to "the clean break principle", grants former spouses of pension fund members immediate access to a court-determined portion of the pension.Instead of members having the maturity value of their pension benefit lowered to reflect the deduction, the fund maintains the members' benefit at the original amount.The fund has acknowledged in documents in The Times' possession that this prejudices members.The affected members are warned that the debt the fund has imposed on them will "accrue interest" at "repo plus 3 [percentage points compounded]".If the member cannot repay the debt and interest, the money is deducted from their benefit.Anton Alberts, the advocate who has taken up the members' case, said the rule had prejudiced about 30000 government employees."Since 2012 roughly 10000 fund members a year have been affected."He said he would ask the public protector to investigate.Alberts said he wanted the finance minister, under whose department the fund falls, to be questioned in parliament about how fund members had been "illegally forced" into debt in contravention of the National Credit Act.He said he and his clients wanted the minister to spell out how affected members would be refunded, the exact amounts of the "loans" made to them by the fund, and how many people, by the fund's own admission, had lost their pension benefits because of the loans...

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