Wednesday, 29 July 2009

The Pension Fund Act

Herewith an extract of the Pension Fund Act. It appears from the Act that the SABC can fund a contribution holiday with its surplus.

15E Utilisation of surplus for benefit of employer

(1) Notwithstanding anything to the contrary in the rules a participating employer may request the board to use

actuarial surplus allocated to the employer surplus account in terms of sections 15B, 15C and 15F for use by that employer

for any of the following purposes, namely -

(a) funding a contribution holiday;

(b) payment of pensions, or an increase in pensions in course of payment, so as to compensate members for

the loss of any subsidy from the employer of their medical costs after retirement;

(c) meeting, in full or in part, expenses which the employer is obliged to pay in terms of the rules of the fund;

(d) improving the benefits payable to all members, or a category of members as defined in the rules, as

determined by the employer;

(e) transferring part, or all, of the employer surplus account in terms of subsection (2) to the employer

surplus account in another fund where the employer is a participating employer;

(f) on liquidation of the fund in terms of sections 28 or 29, payment in cash to the employer in terms of

section 15I; and

(g) in order to avoid retrenchment of a significant proportion of the workforce, payment in cash to the

employer in terms of section 15J:

Provided that the members of the board who have been elected by members of the fund shall not have a vote in any deliberation over the use of any credit balance in the employer surplus account.

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