COSATU welcomes further progress at Parliament on the Revenue Laws Amendment Bill (Two Pot Pension Reforms)

15 March 2024

The Congress of South African Trade Unions (COSATU) welcomes further progress at Parliament on the Revenue Laws Amendment Bill, which is one of two critical legislative amendment bills that will enable the long sought Two Pot Pension Reforms to take place on 1 September 2024. 

We are heartened by the strong support the Bill received today from the National Council of Province’s Select Committee: Finance where COSATU and Treasury presented their submissions in support of the Bill and the Two Pot Pension Reforms.  The Federation is encouraged by the firm commitment by Parliament and the African National Congress and other Members of Parliament that the Bills will be passed before the May 29 elections to ensure the Two Pot Reforms come into effect on 1 September 2024.

COSATU has been engaging on the Two Pot Pension Reforms with Treasury and Parliament since May 2020.  We are pleased that whilst we may not have achieved everything we proposed, not only have we found consensus on the key matters but legislation providing for it is before Parliament and there is agreement for implementation to happen on 1 September 2024.

Workers are highly indebted due to slow economic growth rates, the rising costs of living and having to support relatives in a society battling a 41% unemployment rate.  The current pension laws are excessively inflexible only allowing workers access to their pension funds upon retirement, losing their job or resignation.  Consequently, many workers opt to resign to cash out their entire pension funds leaving them unemployed and with no savings left.

The Two Pot Reforms provide a progressive compromise where workers will have access to a portion of their pension funds whilst remaining employed.  This will allow workers to access 10% up to R30 000 of their existing savings when the law comes into effect on 1 September 2024 and from then on once a year, access to a third of future savings.  Workers will retain access to existing savings.  These will enable workers to remain employed, receive the equivalent of a thirteenth cheque on 1 September and once a year going forward and have more savings when they retire.

It is critical that both Bills are fast tracked and adopted by the two Houses of Parliament before rising in April for the May elections.  If needs be, Parliament should delay its adjournment to ensure these important Bills are passed before the 2024 elections.  This is key to enabling the President to sign, Treasury to promulgate, SARS to adjust its tax systems and the pension funds to amend their rules and put in place the necessary education and administrative support for workers seeking this relief.

What workers cannot afford are any delays to the 1st of September 2024 implementation date.  Workers have been waiting for this relief since 2020.  We dare not disappoint them.

Issued by COSATU

For further information please contact:
Matthew Parks
Acting National Spokesperson & Parliamentary Coordinator
Cell: 082 785 0687