Treasury opposes proposed pension fund law changes

South Africa’s National Treasury rejected proposed changes to pension fund laws that would enable people to access a portion of their savings before retirement as guarantee for a loan.

“We are opposed to having any loans against pension funds because the scope for abuse is high,” Ismail Momoniat, the Treasury’s head of tax and financial sector policy, told lawmakers in a virtual briefing Wednesday.

The bill was introduced by the main opposition party Democratic Alliance in November as a measure to help alleviate financial stress caused by the Covid-19 pandemic.

“We believe the bill should be rejected and parliament should wait for us to present a consensus bill that we are working on,” Momoniat said.