The Congress of South African Trade Unions (COSATU) presented its submission on the Revenue Laws Amendment Bill (RLAB) to Parliament’s Select Committee: Finance today. The RLAB provides for various administrative amendments required by the Two Pot Pension Reforms.
COSATU is pleased with the success of the Two Pot Pension Reforms, first proposed by the Federation in 2020 and supported by government led by the African National Congress and that came into effect on 1 September 2024. To date, over R56 billion has been released to more than 3.5 million struggling workers, enabling them to pay down debt and manage other pressing financial crises without needing to resign from their jobs or cash out their entire pension funds.
The Federation submitted the following urgent proposed amendments to the RLAB to Parliament and Treasury for the next phase of the Two Pot Pension Reforms:
- Ensure that workers who lose their jobs are able to access their full savings, including their preservation pot; so they can save their homes, cars and other belongings; and take care of their families whilst looking for work.
- Enable workers to transfer funds from their vested rights pot to their preservation and savings pots; enabling them to tap into greater relief to settle debt and other financial emergencies whilst simultaneously boosting savings.
- Explore ways to lower the tax burden on low-income workers, in particular those below the income tax threshold and in lower tax brackets.
- Allow workers to utilise savings for education fees as this is this an investment in their and their children’s career path, earning potential and retirement savings.
- Capacitate the Financial Sector Conduct Authority to set caps on fees charged by pension funds on their members.
COSATU trusts that its proposals, which will provide decisive help to millions of struggling and highly indebted workers, will be embraced by Parliament and Treasury. These are urgent and substantial matters that have been discussed extensively over the past few years at Parliament. Workers, their families and communities are in desperate need of support. It is critical that Parliament and Treasury respond decisively to their calls for help.
Issued by COSATU
Matthew Parks (COSATU Parliamentary Coordinator)
Mobile: 082 785 0687
Email: matthew@cosatu.org.za