South Africa’s oldest insurance company on new pension changes for South Africa

On 14 December 2021, the National Treasury released two papers on proposed further retirement reforms for public comment which detail how it plans to transform the retirement savings industry and improve savings outcomes for all South African workers.

These changes will see a fundamental shake-up of pensions and retirement in the country, say analysts at South Africa’s oldest insurance company Old Mutual. Old Mutual was established in Cape Town in 1845 as South Africa’s first mutual life assurance society.

Andrew Davison, head of Advisory at Old Mutual Corporate Consultants, says the most significant among the reforms is the introduction of the two-pot system in which a member’s retirement savings will in future be split into two pots:

• An Accessible Pot into which one-third of their contributions will be invested;
• A Retirement Pot, where the other two thirds will be invested but cannot be accessed.

“This measure will dramatically improve retirement