We've got news for you.

Register on BusinessLIVE at no cost to receive newsletters, read exclusive articles & more.
Register now

The Public Investment Corporation is a fractious and contentious entity. It is a massive investor, even by global standards, and dominates the JSE. Yet its political line has always been precarious. Its reason for existing was to secure the apartheid-era pensions of public servants held in the Government Employees Pension Fund (GEPF) (which the PIC manages). They, and subsequent state workers, receive a defined-benefit pension based on years of service and salary. But fears that an ANC government might not have been able to meet that obligation meant the GEPF was endowed with assets to cover the liability. For a government running a budget deficit, it is like having a savings account and an overdraft. That doesn’t make economic sense. Of course, it doesn’t feel like that when you are a civil servant contributing 7.5% of your salary to it every month (matched by 13%-16% paid by the employer). Civil servants are mitigating their credit risk, though the liability is still borne by the ...

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as articles from our international business news partners; ProfileData financial data; and digital access to the Sunday Times and Sunday Times Daily.

Already subscribed? Simply sign in below.

Questions or problems? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now