2020 amm invite 600
  Benchtest Newsletter
December 2021
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In this newsletter
Benchtest 11.2021, MD year-end message, NAMFISA bombshell, and more...

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Important notes & reminders

  NAMFISA levies
  • Funds with December 2021 year-ends must submit their 2nd levy returns and payments by 25 January 2022;
  • Funds with June 2021 year-ends must submit their 1st levy returns and payments by 25 January 2022; and
  • Funds with January 2021 year-ends must submit their final levy returns and payments by 31 January 2022.
  Retirement calculator

Use our web-based retirement and risk shortfall calculator for your personal retirement planning. Find it here...

If you need help with your financial planning, get in touch with
  • Annemarie Nel (tel 061-446 073)
  • Kristof Lerch (tel 061-446 042)
  • Christina Linge (061-446 6075)
  Registered service providers

Certain pension fund service providers must register with NAMFISA and must report to NAMFISA regularly. Download a list of service providers registered at June 2021, here...
  Toolbox for trustees

RFS provides comprehensive support for trustees. Find a list of download documents to assist with governance and management of private funds, there...

RFS office closed over festive season
Please take note that our office is closed on Friday 24 December and reopens on Tuesday 4 January 2022! We wish all our readers a peaceful festive season and a happy new year. May 2022 be blessed with peace and prosperity, health and happiness!
Floor is now open for comments on FIMA standards and regulations
NAMFISA just sent out an invitation to submit comments on FIMA subordinate legislation by 28 February 2022. Access the relevant subordinate legislation here...

Stakeholders must submit comments on the standard template that is available here...
NAMRA must give its administrative decisions in writing
ICAN was informed by NAMRA that any administrative decision or ruling by a NAMRA official is only valid if it is made in writing.

Read the relevant communication from NAMRA here...
Final consultation on proposed revenue laws amendments
The Ministry of Finance issued draft layman tax bills amending the Income Tax Act, the VAT Act and the Stamp Duties Act, for input and comments.
Follow the links below to these bills. If you want to provide inputs and comments, please do so not later than 22 January 2022 to J Mwafongwe at justus.mwafongwe@mof .gov.na.


In this newsletter, we address the following topics:
  In ‘A Note from the Managing Director’, we present:
  • End of year message to RFS stakeholders;
  • NAMFISA drops Pension Funds Act bombshell.
In ‘Tilman Friedrich’s industry forum’ we present:
  • The folly of point-in-time performance measurement!
In ‘News from RFS’ read about…
  • A reflection on our year-end function
  • RFS sponsors Desert Dash team
In news from NAMFISA read about
  • Public notice on submission of annual returns by foreign funds;
  • Notice of formal consultation on industry standards;
  • Industry meeting of 24 November
  In ‘Legal snippets’ read –
  • Pension fund ordered to relook death benefit payment
In ‘Media snippets’ read –
  • Do local shares still offer value?
  • Asset allocation – an important contributor to portfolio returns;
  • What does a power of attorney over your financial affairs entail?
  • Why an emergency fund is so important.
And make a point of reading what our clients say about us in the ‘Compliments’ section. It should give you a good appreciation of who and what we are!

As always, your comment is welcome, so open a new mail and drop us a note!

Tilman Friedrich
Marthinuz Fabianus
A note from the Managing Director

End of year message to RFS stakeholders

What a year it has been!

It is common cause to expect things in life not to move in a straight line, but the roller coaster of swings and round abouts experienced during this year alone, was more than enough to make anyone hold on for dear life. As people and as business, we are inextricably dependent on nature for our survival, therefore an assessment of events of the year must consider both internal developments as well as external factors.

Here is a kaleidoscope of events that characterised the year 2021, that has all but ended:

January 2021 - Nadja Dobberstein, our marketing consultant was introduced to our business. The country experienced unexpected high rainfall, especially in the southern areas of our country. With a capacity of 3 times that of Hardap Dam, the newly built Neckartal dam filled up to the brim, bringing a lot of hope and optimism for our agricultural economy.

February 2021 - The impact of Corona throughout the country and amongst our staff started to induce fear and uncertainty. Our staff morale dipped to an all-time low.

March 2021 - Theresiana Hausiku becomes the new friendly face at our reception. We rolled out our brand perception survey and gained some valuable insights from our clients’ feedback. Country wide showers erased some fears of another drought, but locusts started to destroy agricultural produce in most north-eastern regions.

April 2021 - The African migratory locusts continue to cause havoc amongst communal farmers in the north. The long awaited Covid vaccines arrived in Namibia.

May 2021 - Crezelda Kooper Joins us to offer much needed relief to Gunter Pfeifer and his team serving the Benchmark Retirement Fund. The 3rd wave of the Novel Corona Virus starts to have devastating effects across all spheres.

June 2021 - Covid deaths spiked around the country, affecting everyone around us (family, friends, associates and country men and women). It becomes like a nightmare we could all not wait to wake up from.

July 2021 - We eventually receive some good news, as the Retirement Fund for Local Authorities in Namibia (our second biggest pension fund client) reappoints us for another 5-year term. Kristina Linge and Elizabeth Janser join us, also to add capacity to the team managing Benchmark Retirement Fund.

August 2021 - Covid cases start to decline around the country, a sense of relief and optimism started to sweep through the country as restrictions were lifted. There was some further good news as the Bank of Namibia Pension Fund, reappoints us for another term as their preferred pension fund administrator.

September 2021 - The decline of pension fund rules of our clients by NAMFISA started to intensify and take a hold on us as a team, the business, and the industry. It became clear that we are facing a new chapter in the pension fund management realm. We received some further good news, as First Rand Group reappoints us as their preferred administrator to their staff retirement fund, against unsustainable pricing from our competitors.

October 2021 - Our staff participated in a much-needed team building exercise, bringing everyone together again like before and a sense of victory as a team prevailed. The much-anticipated new pension fund laws a.k.a FIMA was gazetted on 01 October 2021, throwing the proverbial cat amongst the pigeons.

Also in October, Joyce Muala joined the Benchmark Retirement Fund team. The universities Retirement Fund reappoints us as fund administrators. Whilst the Benchmark Retirement Fund assets crossed the N$ 5 billion hurdle.

November 2021 – The Nampower Provident Fund, reappoints RFS for an extended period of 5 years.

December 2021 – As we start the beginning of this holiday month, tying up loose ends and starting the plans for the coming year, we are yet again facing renewed threats of another waive of Corona flu infections. This is reminiscent of all that we went down, same time last year. It sums up in many ways, the uncertainties that characterised the year that was.

What are we grateful for?

We are tremendously grateful to all our clients, for supporting us through these tough times and for most being acutely aware and prepared to put a price on the unrivalled service from our extremely dedicated staff of pension fund managers. Our clients should not expect anything less. RFS was born out of a need to provide a premium service in the midst of poor service levels and frustrations experienced by many pension fund trustees. Whilst many of the trustees who fully appreciated the difference RFS made to the management of their funds have mostly retired, RFS continuous to provide the same “rock solid fund administration – that makes all trustees sleep in peace”. We are equally grateful to our dedicated team, for staying the course and for adapting to serving our clients in a tremendously difficult operational environment.
What have we accomplished?

We successfully adapted our IT infrastructure, along with certain business processes, allowing all our staff to be able to work simultaneously from the comfort of their home offices if need be. Our staff have adapted to conducting meetings internally and/or with clients via online tools, as though it has always been the norm.
What were our regrets?

We have not been able to take on new clients under our Benchmark Umbrella Retirement Fund since the beginning of this year due to regulatory challenges. Despite boasting the lowest staff turnover over our 22-year history of below 5% per annum, we unfortunately had to say goodbye to four of our staff members during the year. Our staff are highly sought after for the value they demonstrate and thanks to our staff development plans that serve to empower our staff and make them stand out. However, we responded swiftly and managed to redeploy some of our staff and made excellent replacement appointments to make up for lost capacity. Our effective staff retention strategies have seen many of our staff celebrate 5 years, 10 years, 15 years and even 20 years’ service in the year.
What can we do better?

Our payroll administration company !Kharos Benefit Solutions, came slow out of the starting blocks due to the difficult trading conditions as a result of Covid. We believe this company can add value to our medium to small size employer groups that would like to outsource their payroll functions. You are welcome to book an appointment, with our !Kharos Benefit Solutions staff by visiting them here...

FIMA will keep us busy and challenged. We are sparing no efforts and will continue to ready ourselves, as we have started to do already more than a year ago.

I look forward to your continuous contributions and support.

I wish you all a healthy, restful, and safe holiday period.
NAMFISA drops Pension Funds Act bombshell
The Retirement Funds Institute of NAMIBIA (RFIN) hosted a meeting on 11 November 2021 between its members and NAMFISA. The meeting was called following a letter sent to NAMFISA under RFIN’s banner, to address various matters relating to NAMFISA declining applications by various funds to register or amend rules. Since the beginning of 2021, NAMFISA has been declining most of the rules submitted to it, especially by umbrella pension funds. The reasons mostly cited for the declines have mainly been due to NAMFISA regarding the rules as not being compliant with certain sections of the Pension Funds Act. The main sections under question were:
  1. Perceived non-compliance with Section 11 (d) of Pension Funds Act (The rules of a fund shall contain provision regarding the conditions under which any member or other person may become entitled to any benefit and the nature and extent of any such benefit)
  2. Perceived inconsistencies with Section 5 (1) (a) of PFA (fund trustees perceived to be abdicating decision making)
  3. Perceived non-compliance with Section 10 of PFA (Act prohibits Funds from carrying on any business other than the business of a pension Fund) 
The above sections of the Pension Funds Act have been used by NAMFISA to argue that the benefits usually insured with insurance companies (such as benefits upon the death of a member or disablement benefits) should not be provided subject to insurer terms and conditions. It is to be noted that since time in memory, such benefits have been provided by pension funds subject to insurer terms and conditions. The rules referred to such terms and conditions and the insurance policy with terms was provided to the pension fund.
At the meeting of 11 November, NAMFISA was represented by its CEO - Mr Kenneth Matomola, deputy CEO - Ms Erna Motinga, General Manager: Pension Funds & Friendly Societies – Ms Lovisa Namandje-Indongo, and various NAMFISA legal representatives.
What follows below are selected points as noted from the meeting.
Mr Sydwill Scholtz of RFIN opened the meeting and introduced in the issues that needed to be discussed and requiring feedback from NAMFISA. After allowing statements from industry representatives, he invited Mr Matomola to respond to the issues raised.
Mr Matomola subsequently took the floor and stated the following points in summary:
  • He humbly admitted that there was a supervisory oversight on the part of NAMFISA. The oversight led to them approving rules since time in memory and permitting a practice in the industry that the law was strictly clear about. He assumed full responsibility on behalf of NAMFISA and extended his apology.
  • He indicated that going forward, the recently promulgated Financial Institutions and Markets Act (FIMA), which is expected to come into operation from 1 October 2022, is a lot clearer on the matters and did not expect the problem to be perpetuated.
  • The predicament that NAMFISA currently finds itself in as Regulator, is to consider what to do with all the funds that are sitting with rules approved on the incorrect basis. He invited suggestions from anyone to guide the Registrar on what to do, but otherwise indicated that they are currently busy applying their minds to the matter. NAMFISA will inform the industry soonest regarding the matter.
  • Mr Matomola made it clear that NAMFISA will not approve any further rules on the same wrong basis that has been overlooked in the past. They will not condone or perpetuate the wrong any longer, despite appreciating the business implications and dilemma those affected by this decision will be faced with. Mr Matomola referred to a previous NAMFISA Appeals Board ruling and inferred that NAMFISA may be found wanting should they further perpetuate their wrong, especially after learning about it. 
After allowing for comments and questions, Mr Matomola admitted and agreed that the insurable benefits provided to members over the years, played a significant economic and social role and filled a huge void. Mr. Matomola called on industry bodies such as RFIN (mainly representing pension funds) and NASIA (representing insurance companies amongst others), to suggest relevant amendments to the soon to be published Standards and Regulations to FIMA. NAMFISA is not against the provision of these insurable benefits being provided as before but would like it to be in a manner that ensures that NAMFISA’s concerns are addressed, members are not impacted negatively in any way and that industry can continue to carry on business successfully as has been the case up to now.
The legal representative from NAMFISA was adamant that the Pension Funds Act’s sections referred to as Section 11(d) above, was reduced to a Standard under FIMA and was all that required a revision. Some of the industry experts however suspect that new law itself (FIMA) may also have to be amended in addition to the Standards.
Asked when NAMFISA will inform the industry and implored to do so rather urgently, Mr Matomola responded that the legacy issue is enjoying his urgent attention, however it is challenging, and he needs to ensure that he deals with the predicament in a way that does not adversely affect entitled members and beneficiaries.
Informed about the fact that the Registrar continues to approve rules of some funds, whilst declining that of other funds on the same basis, Mr. Matamola accepted full accountability for further inconsistencies and undertook to ensure it does not repeat itself.
The meeting was conducted in a conducive, constructive, and professional manner. RFIN and NASIA were tasked to constitute committees to provide their proposals for relevant amendments to deal with this matter as soon as possible.

At the time of writing, the industry had not yet received the communication from NAMFISA on how funds currently using incorrectly worded rules would be dealt with.
Marthinuz Fabianus graduated from Namibian University of Science & Technology with a Diploma in Commerce and Bachelors in Business Management. He completed a senior management development programme at University of Stellenbosch and various short courses including a macro-economic policy course which he completed at the International Training Centre of the ILO in Turin, Italy. Marthinuz also serves as trustee on the board of the Benchmark Retirement Fund and is a member of the board of the Retirement Funds Institute of Namibia. Marthinuz also served as a Commissioner on the Social Security Commission from 2015-2017.

Tilman Friedrich's industry forum

Monthly Review of Portfolio Performance
to 30 November 2021

In November 2021, the average prudential balanced portfolio returned 1.8% (October 2021: 2.2%). The top performer is Momentum Namibia Growth Fund with 2.8%, while Stanlib Managed Fund with 0.8% takes the bottom spot. For the 3-months NAM Coronation Balanced Plus Fund takes the top spot, outperforming the ‘average’ by roughly 1.1%. Stanlib Managed Fund underperformed the ‘average’ by 2.0% on the other end of the scale. Note that these returns are before (gross of) asset management fees.

The Monthly Review of Portfolio Performance to 30 November 2021 provides a full review of portfolio performances and other insightful analyses.  Download it here...

Do not expect the Default Portfolio to outperform!
The Benchmark Default Portfolio does not aim to outperform the average of the prudential balanced portfolios over the long term. Any long-term outperformance is a coincidence. Yet, since its restructuring at the start of 2010, it beat the average prudential balanced portfolio cumulatively. It was 2.7% ahead of the average at the end of October 2021 after reaching its peak outperformance of 12.4% in March 2020. In March 2020, when COVID hit our markets, the JSE Allshare Index fell 12.8%, from 51,038 to 44,490. In April 2020, the JSE Allshare Index grew by 13.1%, continuing its trajectory to 70,475 at the end of November 2021.
The Benchmark Default Portfolio can underperform and outperform the average prudential balanced portfolio in the short term. It’s currently more conservative structure means that it will likely beat the average prudential balanced portfolio when shares perform poorly, and it will lag it when shares perform strongly. Since the end of March 2021, shares performed strongly, and as a result, the Default Portfolio’s cumulative outperformance to the end of March 2021 declined steadily.
The Monthly Review of Portfolio Performance to 30 November 2021 provides a full review of portfolio performances and other insightful analyses. Download it here...

The folly of point-in-time performance measurement
Interestingly, most investment performance reports present the performance by way of bar graphs. These bar graphs show the point-in-time investment performance, which is meaningless. It is like looking out of the window and concluding that Namibia must have a very humid climate because it happened to rain at that time. Weather bureaus usually present charts as line charts, or if they are bar charts, each bar will represent a month or a year over a specific time. You cannot judge investment managers’ returns by looking at bar chart performance tables. The folly of looking at bar charts becomes more pronounced when markets are very volatile.
To illustrate my point, let’s look at the one-year bar chart performance table for April 2020 and April 2021. For the twelve months to March 2020, shares (JSE Allshare Index) produced a negative return of 22.1%. For the following 12 months to March 2021, shares returned 49.4%!
Graph 6.1 shows the Benchmark Default portfolio being the second-best performing prudential balanced portfolio (blue bars) with a negative return of 6.2%, for the year to 31 March 2020, compared to the negative 6.0% of the best performing prudential balanced portfolio (Stanlib). Graph 6.2 now shows the Benchmark Default portfolio being the worst-performing prudential balanced portfolio with a return of 16.6%, for the year to 31 March 2021, compared to the 37.7% of the best performing prudential balanced portfolio (NAM). Stanlib, top-performer to March 2020, dropped to below-average performance to March 2021, while NAM rose from below-average performance to March 2020 to being top-performer to March 2021. As you can see, fortunes can change drastically over a short time.
Graph 6.1
Graph 6.2
Why did the Benchmark Default Portfolio’s fortune change so drastically? Its investment in shares was 47% in March 2020, compared to the average prudential balanced portfolio’s 62%. By March 2021, these proportions did not change much to 45% and 65%, respectively. It demonstrates that strong performance of shares (March 2021) disadvantages the Default Portfolio as it is currently structured. Poor performance of shares (March 2020) advantages it compared to the average prudential balanced portfolio.
Graph 6.3 reflects rolling three-year returns, and it is a much more insightful reflection of the returns of various portfolios. Each point on a portfolio’s performance line represents the average annual performance of the portfolio to that point for the preceding three years. The reader can now trace every portfolio from left to right. He will see that none of the portfolios was above all the other portfolios, and none was below all the others over the period. Tracing the black line representing the Default portfolio, the reader will see that it lies pretty much in the middle of all the portfolios shown
Graph 6.3
The Benchmark Retirement Fund offers a broad portfolio range, from low volatility to high volatility risk and from high inflation to low inflation risk. The Benchmark Cash portfolio offers the lowest volatility but will not likely beat inflation, and the opposite applies to the prudential balanced portfolios. The Default Portfolio aims to serve the bulk of the Fund’s membership appropriately. The typical member profile for the Default portfolio is an employee in the age bracket of 35 to 45 years old who still has at least twenty years until retirement. The Default Portfolio must perform in the middle of the prudential balanced portfolios. Neither the Default Portfolio nor any other portfolio can serve everyone’s needs. If one presents the needs of Fund members on a graph, the graph will be a bell curve where the highest number of common needs form the bulge of the bell, and the fewer, unique needs sit on the two edges of the bell. Members with special needs must have a clear idea of how their needs differ from the bulk of the Fund’s membership and choose a portfolio or portfolios that serve their needs better than the Default Portfolio. When one plans to change one’s portfolios, one must also know what one expects of the investment markets in the future to avoid making a change at the wrong time. Currently, fiscal and monetary policy across the world distorts investment markets. Share markets are high, and interest rates are low. Both are not sustainable, and a correction will happen. The question is whether the correction will occur in a controlled and gradual fashion or not. Fiscal and monetary authorities are already taking gradual steps towards a correction, and we must hope that investment markets will not experience a hard landing.

The Monthly Review of Portfolio Performance to 31 October 2021 provides a full review of portfolio performances and other insightful analyses. Download it here...

Tilman Friedrich is a chartered accountant and a Namibian Certified Financial Planner® practitioner, specialising in the pensions field. He is co-founder, shareholder, and Chairman of the RFS Board and retired chairperson, and now a trustee of the Benchmark Retirement Fund.


From an insurance broker
Dated 17 November 2021
  “Ek wil net vir jou baie baie dankie se vir die goeie diens wat ek van jou af ontvang het. Ek het regtig lanklaas by enige instansie in Namibië sulke spoedige diens gekry en gevoel ek werk met iemand wat my wil help. Ek wens ek was nader aan Windhoek dat ek nou vir jou n boks chocolates kon koop vir jou diens. Baie Dankie!”  

Read more comments from our clients here...


A note from Günter Pfeifer

Important circulars issued by the Fund
The Benchmark Retirement Fund did not issue any new circular since those reflected in Benchtest 09.2021. Clients are welcome to contact us if they require a copy of any circular.
Günter Pfeifer is Principal Officer and was formerly a trustee of the Benchmark Retirement Fund. He holds a Bachelor of Commerce (Cum Laude). He completed his articles with Deloitte & Touche. He completed the De Beers ‘Program For Management Development’ at Gordon Institute for Business Science, and the Advanced Development Program at the London Business School. He was formerly Financial Manager of De Beers Marine.

News from RFS

A reflection on our year-end function
We held another most enjoyable year-end function at Windhoek Country Club clubhouse on 27 November.
  The MD’s review of 2021
  Annual awards lined up
  The RFS Fairy goes to…  Rudigar van Wyk
  Thank you to the outgoing social committee  
  The audience listening attentively   Our ladies showing off their best poses!  
RFS sponsors Desert Dash team

RFS recently sponsored two teams participating in the Desert Dash, a 369 km single stage mountain bike race taking place in 24 hours. The Desert Dash is the longest single-stage mountain bike race in the world.

Pictured above in RFS kit are Barend Booysen, Karin Loftie-Eaton, Thomas Theron and Hanru Truter.

Important circulars issued by RFS
RFS did not issue any new circular since those reflected in Benchtest 09.2021. Clients are welcome to contact us if they require a copy of any circular.

News from NAMFISA

Public notice on submission of annual returns by foreign funds  

The Registrar of Pension Funds requires all foreign funds registered in Namibia to complete and submit a Foreign Fund Return (FFR) form, as at the fund’s financial year-end. It must be in the format of a spreadsheet titled “Annexure A - Foreign Funds Return” (which was not attached to the notice). Foreign funds must submit the FFR within four (4) months of the Fund’s financial year-end, beginning with the year-end that immediately follows the date of this industry notice.

Find the notice, here…

Notice of formal consultation on FIMA standards

On 16 December, NAMFISA issued a public notice to the “non-banking financial institutions” industry informing that:
  1. It submitted the standards to the Ministry of Justice for publication in the Government Gazette on 1 December 2021, and it expects their publishing during December.
  2. The industry must review the standards and regulations accessible at this link  and submit comments to This email address is being protected from spambots. You need JavaScript enabled to view it. no later than 28 February 2022.
Industry meeting of 24 November

NAMFISA conducted the last industry meeting of the year on 24 November 2021. Its presentation informed delegates on the following matters:
  • Complaints lodged with NAMFISA:
    • It received 231 complaints against all industries, of which 36 (previous quarter – 27) concerned pension funds. Most were against long-term insurance companies (98.) Most pension fund complaints (12) concerned non-payment of benefits. NAMFISA had already resolved 27 of the 36 pension fund complaints of N$ 1.6 billion, 15 in favour and 12 against funds.
  • Rules that do not comply with the Act:
    • Fund rules must spell out clearly the conditions for and the nature and extent (i.e., the amount) of benefits due to any person.
    • If the benefit amount is conditional, the rules must explain the conditions.
    • NAMFISA will not approve rules that do not meet these requirements.
Note: This topic addresses what our MD covers in his column under the heading “NAMFISA drops Pension Funds Act bombshell.” NAMFISA undertook to issue a circular before the end of November already but will likely only issue one in 2022.
  • Fund registration plan for moving to FIMA:
    • A fund must comply within 90 days of Chapter 5 effective date with the establishment and the composition of the board of trustees. Every fund must have four independent, fit and proper trustees by December 2022, half of whom the members elected (assuming 30 September 2022 as the effective date.)
    • Funds must review their rules, service provider contracts, and all other fund operational matters to ensure they comply well before 31 December 2022 to carry out the process in time still.
    • FIMA prescriptions overrule conflicting rule prescriptions, and NAMFISA will not register rules that do not comply, which means that the fund may not operate.
    • NAMFISA emphasises that funds must ensure their trustees are independent.
    • Funds must simultaneously submit all the documents required for registration. It covers rules with valuator certificate, code of conduct, sponsor resolution establishing the fund, CV and ID of each trustee and the principal officer with police clearance and fit and proper form, copies of all service provider agreements, proof of payment of the prescribed fee, and completed section A and B of the annexure A of standard RF.S.5.24.
    • Funds must write their rules and documents that members will get in plain language by 30 September 2023.
    • Late payment interest on benefits and contributions paid late applies from 1 October 2022.
    • Any trust that houses pension benefits for its beneficiaries must register with NAMFISA as a beneficiary fund and comply with FIMA.
    • NAMFISA will not accept draft rules ahead of the FIMA effective date.
    • NAMFISA’s current service level commitments will initially not apply under FIMA.
    • Industry consultations on standards and regulations:
      The industry pointed out that it needs time to adjust its processes and procedures to the final regulations and standards before the Acts become operational and enquired if NAMFISA will circulate the final regulations and standards to the industry well in advance before the Acts become operational. NAMFISA answer to this was not clear.
  • FIMA rules template:
    • NAMFISA issued a template on 3 November, and comments were due by 15 December.
    • Funds must ensure that their rules cover all the sections and topics in the template and in the same order, but the rules may contain further provisions. The rules must point out as such any section or topic that does not apply.
    • The fund’s master (or main) rules must -
      • spell out clearly the conditions for and the nature and extent (i.e., the amount) of benefits due to any person;
      • If the benefit amount is conditional, the rules must explain the conditions;
      • detail how the fund will apply contributions;
      • detail the cost universe, the fee levels, and the basis for charging the fees;
      • the accounts the fund must maintain and how it will allocate the transactions to these accounts;
      • the spectrum of available investment choices.
  • Feedback on statutory submissions:
    • There are currently 92 registered funds, of which
      • 16 are dormant and
      • 76 are active.
    • All 76 active funds submitted their latest quarterly returns in time. Of these -
      • 48 are private funds, and
      • 28 are insured funds.
    • Total industry assets amount to N$ 194.7 billion.
    • Total industry contributing members was 378,500.
  • Quarter 2 of 2021 off-site inspection findings:
    • Governance related risks:
      • rules requiring only one meeting per year;
      • long-serving service providers;
      • trustee remuneration not covered by the rules;
      • board composition is not consistent with the rules;
      • quorum requirement not adequate;
      • decision making left to service providers.
    • Legal and compliance risks:
      • Non-compliance with NAMFISA circular on the disposition of unclaimed benefits;
      • Non-compliance with unlisted investment requirements;
      • Non-compliance concerning the capping of dual-listed shares as Namibian assets;
      • Non-compliance concerning the payment of contributions.
    • Operational risks:
      • Death benefits older than one year.

Legal snippets

Pension fund ordered to relook death benefit payment

The complainant was the former life partner of LB Mantjiu who passed away on 4 March 2017. The deceased was a member of the first respondent, administered by Absa Consultants and Actuaries (Pty) Ltd (second respondent).

Following the deceased's demise, a death benefit in the amount of R1 065 480.00 became available for distribution to his beneficiaries and dependants. The board resolved to allocate the entire benefit to the deceased's mother, RD Mantjiu ("MS Mantjiu"), to the exclusion of the complainant.

The complainant submitted that she is a nominee in the deceased's beneficiary nomination form and as such, she should have been considered by the fund.

The deceased passed away in a car accident together with their minor son.

The complainant said that despite the fund's submission that it considered all the relevant factors in deciding to exclude her, it failed to consider the fact that Ms Mantjiu was 75 years of age and received an old age grant from the State which satisfied all her maintenance needs.

She submitted that the board failed to consider Ms Mantjiu's needs, her extent of dependency on the deceased, whether or not only the deceased provided her with financial support and if she received income from other sources.

She added that the board failed to consider other sources from whence Ms Mantjiu could have received some funds and what impact those funds had on her needs. She asked what socio-economic difficulty would have befallen Ms Mantjiu if she was allocated 50% of the death benefit as set out in the beneficiary nomination form.

She further asserted that the board failed to consider her personal circumstances and the fact that the complainant was a nominee entitled to 50% of the death benefit.

The second respondent submitted that during its investigation, the board established that Ms Mantjiu was a pensioner and financially dependent on the deceased for maintenance prior to his demise.

She was also nominated to receive 50% of the death benefit in the deceased's beneficiary nomination form. Due to the fact that the deceased had to maintain his mother, she was accordingly identified as his factual dependant.

It stated that the deceased was involved in a life partnership with the complainant when he signed the beneficiary nomination form on 5 March 2010. The relationship between the deceased and the complainant was non-existent at the time of his demise.

During their period of break-up, the deceased maintained his son with the complainant. Thus, the extent of financial dependency of the complainant on the deceased was the contributions towards his son's general maintenance and not directly towards the complainant's financial needs.

In this regard, it referred to an affidavit signed by the complainant wherein she stated that the deceased provided her with money in respect of their son's maintenance.

The board's investigation revealed that the complainant was gainfully employed and earned R21 000 per month, was 37 years of age and fully able to generate income through her employment.

It submitted that even though the complainant was a nominee, the board identified her as not being financially dependent on the deceased. The level of financial dependency to maintain their son did not exist anymore as their son passed away with the deceased.

In her determination, Ms Lukhaimane said in principle a member is legally liable for the maintenance of a spouse and children as they rely on the member for the necessities of life. In the case of factual dependants, where there is no duty of support, a person might still be a dependant if the deceased in some way contributed to the maintenance of that person. She said having conducted its investigation, the board resolved to allocate the entire death benefit to Ms Mantjiu, to the exclusion of the complainant.

However, she said where there are dependants and nominees, the Act provided for the board to make an equitable distribution.

In the present matter, the amount of the death benefit is R1 065 480.

Ms Mantjiu was proven to have been financially dependent on the deceased, received an old age pension from the State and was allocated the  entire amount of the death benefit.

Ms Mantjiu also received a payment in respect of a group life assurance benefit. On the other hand, the complainant who is 37 years of age was excluded and is earning a monthly salary of R21 000.

Ms Lukhaimane said one of the critical sore points was that the deceased completed a beneficiary nomination form assigning 50% of the death benefit to the complainant and another half to his mother. However, the board failed to follow the deceased's wishes.

The board should have considered the complainant on the basis that she was a nominee. The complainant did not have to prove that she was financially dependent on the deceased for her to be considered.

The mere status of being a nominee compelled the fund to consider her situation together with the totality of other relevant factors.

Ms Lukhaimane set aside the decision of the board of the first respondent to allocate the entire amount of the death benefit to Ms Mantjiu, to the exclusion of the complainant, without considering relevant factors.

The board of the first respondent was ordered to re- exercise its discretion in terms of section 37C of the Act, considering the issues raised in this determination.

Source: The 2018-19 annual report of the Office of the Pension Fund Adjudicator.

Snippets for the pension fund industry

Do local shares still offer value?

“The question of whether there is still value to be found on the JSE – with the All Share Index (Alsi) at record highs – elicited an interesting discussion between fund managers at a recent investment conference hosted by Morningstar Investment Management SA.
The short answer is that there are still a few sectors that offer opportunities.

Sean Neethling, portfolio manager at Morningstar, noted that the past 20 months have been unprecedented in financial markets – with most experiencing a sharp sell-off at some stage, only to recover to historic highs.

“Just when you think you know what will happen next, the ballgame changes. It’s no wonder investors often don’t know which way to turn to and sometimes seek safety in cash-like instruments,” he says.

The performance of the JSE proves his point. In March 2020, the Alsi crashed by around 30% in a few days to a low of 40 000 points. It recovered to a high just shy of 73 000 points last week, rewarding courageous investors with a gain of more than 80%.

However, Neethling says local investors are now facing a challenge: “Going forward, will local still be lekker, or should investors be venturing more into offshore equities?”…”

Read this opinion of Adriaan Kruger, in Moneyweb of 14 December 2021, here…

Asset allocation – an important contributor to portfolio returns

“As a multi-manager, the two most important investment decisions we face are manager selection and asset allocation. Our manager selection process is aimed at identifying managers and funds that deliver consistent long-term performance aligned with the investment philosophy of the strategy. The process entails screening, due diligence (that includes quantitative and qualitative analysis) and a manager blending exercise that identifies which strategies combine well to deliver a diversified outcome for clients.

Asset allocation as an investment strategy is based on the empirical studies focused on how each asset class performs and correlates relative to each other. It is the large lever impacting both risk and returns delivered by any portfolio.

Let’s unpack the asset allocation process, using the most recent house view change, as an example of how this is applied in practice.

Optimising the long-term asset allocation

The asset allocation process starts by optimising a long-term strategic asset allocation (SAA). This SAA uses the historic returns and volatility of the various local and international asset classes to assign allocations based on the ability to achieve an inflation target over time. The higher the inflation target, the more risk the allocation assumes, which generally implies that more equity is required, but historic volatility is considered to ensure unnecessary risk is not onboarded. The SAA is modelled annually to keep it up to date, but seldom changes due to the long-term nature of the inputs.
Taking advantage of short-term opportunities

The shorter-term component of the process is the tactical asset allocation (TAA). Here an 18- to 24-month view is applied to tactically adjust the SAA based on three prevailing factors surrounding the asset class: the valuation, the macroeconomic aspects that are currently affecting it and the price momentum...”

Read this perspective of Luigi Marinus in Cover  of 2 December 2021, here…

Snippets for investors

What does a power of attorney over your financial affairs entail?

“…Broadly speaking, a power of attorney is a written declaration by one person (the principal) to bestow powers on another person (the agent) to perform juristic acts (i.e. actions that are intended and capable of having a legal effect) on their behalf. A power of attorney is not a contract but, rather, is made possible in terms of the South Africa law of agency – the basis of which is that an agent is not permitted to perform any juristic act that the principal is incapable of performing.

In our country, anyone over the age of 18 who has contractual capacity is capable of granting a power of attorney. This means that the person granting the power of attorney must be legally capable of performing the acts that they are granting their agent the power to perform. In signing over a power of attorney to the agent, the principal is in effect assuring a third party that the agent has the legal authority to act on their behalf.

As the name implies, a general power of attorney mandates an agent to perform and carry out a range of legal acts on behalf of the principal, such as opening bank accounts, selling property, entering into contracts, and managing business interests. On the other hand, a special power of attorney provides more limited or specific powers to the agent, such as where the principal signs a Special Power of Attorney to Tax Practitioner (TPPOA) which allows a tax practitioner to represent their tax affairs at Sars.

In South Africa, there is no prescribed form or document for a power of attorney, and it is therefore essential that you seek guidance from an expert to ensure that the written mandate is aligned with the powers you wish to bestow on your agent. Whether a general or special power of attorney, the document must clearly describe and identify the principal and agent and must clearly set out the extent of the powers bestowed on the agent…”

Read the full article by Nowana Sobopha of Momentum, in Cover of 27 October 2021, here...

Why an emergency fund is so important

“The primary purpose of an emergency fund is to cover your expenses for a period of at least six months in case of your retrenchment, dismissal, or any other situation that can prevent you from earning an income. In other words, it is a fund established for the purpose of ensuring that your expenses are covered for a certain period, until such time as you can return to your full income generating ability.
How are these funds invested?

Cash related to an emergency fund is usually saved in a savings account, or in a money market-linked account at a bank. It is imperative that these funds are protected against market volatility, and they should (preferably) be available at short notice, which makes the abovementioned products ideal for this purpose….
How do I get started?

An emergency fund needs to be monitored and revised on a regular basis to ensure that it keeps up with your circumstances and stays that way. Probably the first and most important step, is to compile a comprehensive budget outlining your monthly income and expenses. This will also give you an indication of your spending habits and will help you to cut back on unnecessary spending. Once you can see your expenses on paper, you will be able to calculate how much you will need in your emergency fund.

Also consider price increases. If you are starting with this process relatively late in the year, remember that medical aid contributions and electricity costs, for example, increase annually, and also that your municipal accounts may vary from month to month.

The next step is to determine how you will be funding your emergency fund…”

Read the article by Schalk Louw, PSG Wealth in FPI mymoney 123™ of 7 December 2021 here…

And finally...

Great quotes have an incredible ability
to put things in perspective.

"The happy medium - truth in all things - is no longer either known or valued; to gain applause, one must write things so inane that they might be played on barrel-organs, or so unintelligible that no rational being can comprehend them, though on that very account, they are likely to please.”
~ Wolfgang Amadeus Mozart


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Whilst we have taken all reasonable measures to ensure that the results reflected herein are correct, Benchmark Retirement Fund and RFS Namibia (Pty) Ltd do not accept any liability for the accuracy of the information and no decision should be taken on the basis of the information contained herein before confirming the detail with the relevant portfolio manager.

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