In 2018 the local Benchmark Retirement Fund’s assets grew to N$2.920 billion, up from N$2.744 billion in 2017. Its membership grew to 11 548 members.
Despite the challenging operating environment and the proliferation of regulatory requirements, the Fund continues to grow, with new participating employers joining the Fund as well as with a growing number of members preserving their retirement capital in the Fund or choosing to draw monthly pensions from the Fund. The Fund catered to 961 annuitants who received N$54 million in annuities in 2018.
The Fund continues to be managed on a world class basis with a strong focus on governance and is increasingly becoming the number one address in the umbrella pension fund space.
Guest speaker Barend le Grange, Head of Individual Member Support, Sanlam Employee Benefits, at the recent Benchmark Annual Member Meeting. Le Grange noted a distinct trend in retirement funds switching to umbrella funds due to the complexity and cost of administering private funds.
In terms of investments, 2018 was a challenging year as a large number of global and local asset classes performed poorly in difficult economic environments. Investment growth should resume once the global and regional economic outlook improves. Growth of pension fund investments is typically measured over periods of 5 to 10 years, where the long-term returns of investments usually outweigh the short-term impact of restrained growth and recessions.
Günter Pfeifer, Trustee of the Benchmark Retirement Fund, said that the Fund is continuing to prepare for the FIM Bill. He said that the Bill, which regulates non-banking financial institutions, places burdensome conditions on retirement funds. The requirements imposed by the new bill are substantial and it is likely that only very large retirement funds as well as umbrella funds will have the necessary scale to implement these requirements.
Pfeifer also issued a note of caution to guardians of minor dependents. The latest Administration of Estates Amendment Act will have an impact on minor members as their benefits will have to be paid via the Guardians Fund. There may be some payment delays from the Master’s Office to the guardians of these minors since payments by the Master are made quarterly, unlike Benchmark which makes payments monthly.
At the same event, guest speaker Barend le Grange, Head of Individual Member Support, Sanlam Employee Benefits, noted a distinct trend in retirement funds switching to the umbrella funds due to the complexity and cost of administering private funds. He went on to caution participating funds against seeking cost savings at the expense of delivering value to fund members.
The Benchmark Retirement Fund is administered by local pension fund administrators Retirement Fund Solutions (RFS), and has a board composed of independent non-executive trustees, and executive trustees nominated by RFS. It caters for a wide range of requirements ranging from individuals and employees of very small groups to SMEs and larger funds, who require a vehicle that adheres to local standards and regulations. The Fund also caters to retirees, and minor and adult dependents of members.