Its predecessor report, a much shorter version, was just submitted for the first time at the end of February for the 4 quarters of 2014, after having given the industry close to 3 months to prepare for that version.
The new report, which has to be manually inputted into Namfisa's Electronic Regulatory System, comprises of no less than 53 pages of information and data plus another 7 pages per investment portfolio operated by a fund. An early version of this report, in Excel format was circulated to the industry in March 2014. At the time the industry expressed its concerns and reservations about this report. The cost of producing such a extensive report versus the benefits of having the information, the time it would take to program systems to record and produce the reports as well as the purpose and use of some of the information were questioned, without convincing response by the regulator.
When a new, much shorter report version was circulated later in 2014 the industry took comfort with this, because the investment related information was actually aligned with regulation 28, on which asset managers had to report for many years, while the other information, of a limited scale, by and large also already, had to be reported on for a couple of years.
During the regular 'industry meetings' arranged by Namfisa since the introduction of the abbreviated report version, no reference was made to the fact that Namfisa's programmers were actually busy programming the Electronic Reporting System on the basis of the extensive report initially circulated in March 2014. Even upon a follow up with a Namfisa official on the status of the requirements for the first quarter 2015 report a few days prior to the latest version having been circulated, the official confirmed that there was no change to the reporting format.
What a surprise to all concerned to find a few days later that the report has now actually been expanded from 1 page of general information and 7 pages of information per investment portfolio to the monster referred to above.
To make matters worse, the circular was issued 2 days before the start of the school holidays with a due date in the middle of school holidays over a period covering 3 short weeks, due to public holidays. The principal officer who asked whether the industry was intentionally kept in the dark all along may be forgiven.
Pension funds are now in the unenviable position that they are required to comply. Yet they will have to call on their service providers to assist while service providers will in most likelihood not be contractually obliged to meet this totally new requirement, and may in fact not be able to provide much of the required information due to the fact that their systems are not geared to capture, store and retrieve the information in the manner and format required. At best all parties involved will have to improvise and it may be expected that some of the information is not available or will be unreliable or inaccurate. How meaningful will such information be to the regulator?
Many pension funds have expressed their perception that the regulator is ruling autocratically, is exercising unreasonable pressure on their limited resources and is disregarding their concerns or suggestions. The concern was also expressed that funds are being systematically alienated through the approach of the regulator and that this will not be conducive to a spirit of mutual respect and co-operation.
Funds believe that the regulator does not appreciate the fact that the Namibian industry is totally dependent on layman trustees who are full time employees that are burdened with the additional responsibility of serving as trustee. Namibia has just over 100 registered funds with a membership of around 220,000. Eliminating the GIPF and umbrella funds, the average size of employer sponsored funds is around 500 members. For reference purposes it is relevant that the SA regulator takes the view that employer sponsored funds of less than 3,000 members are not viable on a stand-alone basis and should rather be accommodated in an umbrella fund. In terms of reporting though, even the SA regulator does not have such extensive requirements.
Ironically, NAMFISA seems intent on getting better insight on costs of managing pension funds and has given the impression that they may be concerned about these costs being too high.
To avoid alienation of pension funds and any confrontation, there is an urgent need that an independent and unbiased statutory mechanism is created under the Pension Funds Act that will objectively consider justified general concerns and objections of the pension funds industry and that has the authority to guide the regulator. Until such time, it will be purposeful for the Minister to play a role in introducing balance and fairness into the regulatory system.
Appealing decisions by Namfisa
Government notice no 160 provides an appeal procedure and form for persons wishing to appeal any ruling or decision of the chief executive officer of Namfisa made under the Namfisa Act. The new quarterly report is required in terms of the Pension Funds Act though, which does not provide for an appeal process. Funds should, however, consider using the procedure to appeal any other matter they may be aggrieved with which originated by Namfisa under the Namfisa Act,. It is to be noted that a person intending to appeal a decision of the chief executive officer in terms of the Namfisa Act must commence the appeal within 14 days of receipt of the notice.
Speaking about the Trust, RFS Managing Director Tilman Friedrich said the company has a policy of empowerment from within. "We believe in recognising, rewarding and empowering the individuals who make our company a success, and that is actually everyone in the team" he said.
'With the RFS Staff Trust, we recognise each and every staff member who has assumed the responsibility for making the company the success it is," Friedrich continued.
He pointed out that RFS has built its business primarily on the qualities of its staff. He noted that the company enjoys a low staff turnover and that all staff members are highly experienced. Friedrich said that, in addition to numerous formal qualifications, the company has a policy of ongoing internal training to keep staff abreast of changes in the dynamic Namibian pension fund environment.
"We have a policy of recognising skills and personal development with professional responsibility. The Trust is an appropriate manner to recognise that our team takes ownership," Friedrich continued.
Asked about the impact of the Trust on formerly disadvantaged Namibians, Friedrich said formerly disadvantaged beneficiaries amounted to 15% of the 17,5% of shares allocated. He said this share was expected to grow to 17,5% and 20% respectively during the course of the year.
The allocation, Friedrich said, brought the total number of formerly disadvantaged beneficiaries of ownership in RFS to 36,25% at the Trust's inception.
"'financial services' means - ....
(g) provision, or transfer of ownership, of an interest in a scheme whereby provision is made for the payment or granting of benefits by a benefit fund, provident fund, pension fund, retirement annuity fund or preservation fund; or....
(i) the arranging of any services referred to in paragraphs (f) to (h), inclusive, or the management of any fund or entity referred to in paragraphs (g) and (h);..."
Although this is open to interpretation, particularly as regards consulting services (i.e. asset or benefit consulting services), our view is that the services to be provided by your consultant to your fund may well be covered by this definition and would then be VAT exempt. We are aware of a Practice Note issued by Inland Revenue with regard to medical aid funds, specifically excluding IT services provided under a separate agreement, but believe that this Practice Note (No 7 of 2000) is not necessarily to be seen as guidance in this context.
Funds that are not registered for VAT cannot claim input VAT. Paying VAT on services that may fall under the definition of sub-paragraph (i) of the definition of 'financial services' would unnecessarily add to the cost burden of members and should avoided.
Retirement Fund Solutions
- About us
- Unlisted investments via unit trusts
- 2014 Sanlam benchmark Survey 1
- 2014 Sanlam benchmark survey 2
- Payment of unclaimed benefits to the Master of the High Court
- Unlisted investments - proceed with caution
- Professional indemnity cover and policy terms
- Regulation 28 and 29
- African Cup of Investments Conference 2013 Part 1
- Africa Cup of Investments Conference 2013 Part 2
- Africa Cup of Investments Conference 2013 Part 3
- Africa Cup of Investments Conference 2013 Part 4
- Africa Cup of Investments Conference 2013 Part 5
- Investment in foreign unit trusts
- What is your performance benchmark?
- Unclaimed benefits – a dilemma for trustees
- Should you rotate your service providers on a regular basis?
- What is a service worth to you? Part 1
- What is a service worth to you? Part 2
- Billion dollar milestones for RFS and Benchmark
- Dismissal – a major risk for the employer
- Pension or provident fund, lump sums or pensions - where to from here?
- Amendments of the Labour Act
- Has the pensions industry been led astray by its advisers?
- 2011 Market Trends
- Act 15 of 2011: what to do
- Income Tax Amendment Act, Act 15 of 2011
- African Cup of Investments Conference 2011
- Aims of the retirement fund
- Fund strategy
- How to invest in uncertain times
- The salary replacement ratio
- Preferred risk vs required risk
- Counter party risks
- Pitfalls of purchasing a pension
- Stress testing the life stage model
- How to handle fund disputes
- Employers on boards of trustees
- Good for the group or good for the member?
- Absence from work
- Staff absence and conditions of employment
- The fund and maternity leave
- Additional voluntary contributions
- The Master of the High Court
- Administration of deceased estates
- Foreign domiciled funds
- Housing loans for property outside Namibia
- Changes to the SA Estate Duty Act
- Namfisa issues revised draft amendments to regulation 1, 26, 27, 28 and 29
- Namfisa Reporting August 2013
- Can retirement capital be transferred from a retirement annuity to a pension fund at retirement?
- RFS supports Okanti Foundation
- Selecting asset managers to diversify risk
- RFS 15th anniversary speech
- 15 years of RFS
- RFS 15th anniversary client satisfaction survey
- Pension Funds Act amended with regard to housing loans
- Service or product provider due diligence and SPVs
- The implication of remuneration packages for employees well-being
- National priorities and legislation are not ‘in synch’
- The conundrum of ‘tied’ versus ‘untied’ annuities
- Payment of death benefits into a testamentary trust
- 2015-03 draft industry standards
- Regulations 1 to 7 under Part I of the Pension Funds Act Repealed
- Comment: Anger rising in the pensions industry
- VAT and services provided to a fund
- Retirement Fund Solutions announces staff trust
- Corporate philosophy
- Human capital
- Fund strategy
- Sind Sie fit für die Rente?
- Planning your retirement
- 15 years of RFS
- Social Responsibility
- Contact us
- Browser Upgrade
Benchmark Retirement Fund
- Benchmark Home
- About Benchmark
- Why choose Benchmark?
- How to join Benchmark
- Fund membership until 75
- Full Individual Member Application
- Abbreviated Ind Member Application
- Terms & Conditions
- Beneficiary Nomination Form
- Claim Form Retirement & Death
- Investment Portfolio Change
- Withdrawal Application Form
- Bank Detail Verification Form
- Pensioner Application Form
- Pensioner Review of Instructions
- Pensioner Designated Survivor Form
- Investment portfolios
Fund fact sheets
- Allan Gray Namibia Balanced Fund
- Bank Windhoek Investment Fund (Money Market Portfolio)
- EMH Prescient Absolute Balanced Fund
- Investec Managed Fund Namibia
- NAM Coronation Balanced Defensive Fund
- NAM Coronation Balanced Plus Fund
- NAM Coronation Capital Plus Fund
- Old Mutual Namibia Profile Pinnacle Portfolio
- Prudential Namibia Balanced Fund
- Prudential Namibia Inflation Plus Fund
- Sanlam Namibia Active Fund
- Sanlam Namibia Inflation Linked Fund
- Standard Bank Namibia Managed Fund
- Benchtest 2015-03
- Benchtest 2015-02
- Benchtest 2015-01
- Benchtest 2014-12
- Benchtest 2014-11
- Benchtest 2014-10
- Benchtest 2014-09
- Benchtest 2014-08
- Benchtest 2014-07
- Benchtest 2014-06
- Benchtest 2014-05
- Benchtest 2014-04
- Benchtest 2013 Archive
- Benchtest 2012 Archive
- Benchtest 2011 archive
- Benchtest 2010 Archive
- Benchtest 2009 Archive
- Early Bird
- Quarterly investment report
- 2013 Financial Highlights
- 2013 Actuarial Report
- 2013 Annual Report
- Benchtest Monthly
- Rules of the Fund
- Download documents
- Trustees and Principal Officer