Surplus? What is Surplus? Did the pension funds second amendment act achieve its aims ?

 

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dc.contributor.author Davis, R W D
dc.contributor.author Kendal, S
dc.date.accessioned 2016-04-28T08:02:57Z
dc.date.available 2016-04-28T08:02:57Z
dc.date.issued 2012
dc.identifier http://dx.doi.org/10.4314/saaj.v12i1.4
dc.identifier.citation Davis, R. W. D., & Kendal, S. (2012). Surplus? What surplus? Did the Pension Funds Second Amendment Act achieve its aims?. South African Actuarial Journal, 12, 97-128. en_ZA
dc.identifier.issn 1680-2179 en_ZA
dc.identifier.uri http://hdl.handle.net/11427/19257
dc.identifier.uri http://www.ajol.info/index.php/saaj/article/view/82478
dc.description.abstract The Pension Funds Second Amendment Act, 2001 required funds to provide statutory minimum benefits for exiting members and pensioners. Any surplus arising at the statutory valuation following the promulgation of this Act was to be distributed—initially to former members and pensioners to top up their benefits to the statutory minimum, and then equitably to all stakeholders. Surplus available in retirement funds was originally estimated at R80bn, but the surplus distributed by May 2012 was only about R47,6bn. This paper considers some reasons for this discrepancy and, in particular, gives an analysis of 447 surplus valuation reports. It shows that, by strengthening their valuation assumptions and motivating contingency reserves, actuaries reduced the surplus by R10bn for these 447 funds. The paper questions whether the strengthening of valuation bases was justified and examines critically the new actuarial methods introduced following the promulgation of the Act. en_ZA
dc.language eng en_ZA
dc.publisher Acturial Society of South Africa en_ZA
dc.rights Creative Commons Attribution 4.0 International (CC BY 4.0) *
dc.rights.uri http://creativecommons.org/licenses/by/4.0/ en_ZA
dc.source South African Actuarial Journal en_ZA
dc.source.uri http://www.actuarialsociety.org.za/Professionalresources/SAActuarialJournal.aspx
dc.subject.other pension funds
dc.subject.other distribution of surplus
dc.subject.other valuation methods
dc.subject.other valuation assumptions
dc.subject.other contingency reserves
dc.subject.other public interest
dc.title Surplus? What is Surplus? Did the pension funds second amendment act achieve its aims ? en_ZA
dc.type Journal Article en_ZA
dc.date.updated 2016-04-28T08:00:43Z
uct.type.publication Research en_ZA
uct.type.resource Article en_ZA
dc.publisher.institution University of Cape Town
dc.publisher.faculty Faculty of Law en_ZA
dc.publisher.department Department of Commercial Law en_ZA
uct.type.filetype
uct.type.filetype Text
uct.type.filetype Image
dc.identifier.apacitation Davis, R. W. D., & Kendal, S. (2012). Surplus? What is Surplus? Did the pension funds second amendment act achieve its aims ?. <i>South African Actuarial Journal</i>, http://hdl.handle.net/11427/19257 en_ZA
dc.identifier.chicagocitation Davis, R W D, and S Kendal "Surplus? What is Surplus? Did the pension funds second amendment act achieve its aims ?." <i>South African Actuarial Journal</i> (2012) http://hdl.handle.net/11427/19257 en_ZA
dc.identifier.vancouvercitation Davis RWD, Kendal S. Surplus? What is Surplus? Did the pension funds second amendment act achieve its aims ?. South African Actuarial Journal. 2012; http://hdl.handle.net/11427/19257. en_ZA
dc.identifier.ris TY - Journal Article AU - Davis, R W D AU - Kendal, S AB - The Pension Funds Second Amendment Act, 2001 required funds to provide statutory minimum benefits for exiting members and pensioners. Any surplus arising at the statutory valuation following the promulgation of this Act was to be distributed—initially to former members and pensioners to top up their benefits to the statutory minimum, and then equitably to all stakeholders. Surplus available in retirement funds was originally estimated at R80bn, but the surplus distributed by May 2012 was only about R47,6bn. This paper considers some reasons for this discrepancy and, in particular, gives an analysis of 447 surplus valuation reports. It shows that, by strengthening their valuation assumptions and motivating contingency reserves, actuaries reduced the surplus by R10bn for these 447 funds. The paper questions whether the strengthening of valuation bases was justified and examines critically the new actuarial methods introduced following the promulgation of the Act. DA - 2012 DB - OpenUCT DP - University of Cape Town J1 - South African Actuarial Journal LK - https://open.uct.ac.za PB - University of Cape Town PY - 2012 SM - 1680-2179 T1 - Surplus? What is Surplus? Did the pension funds second amendment act achieve its aims ? TI - Surplus? What is Surplus? Did the pension funds second amendment act achieve its aims ? UR - http://hdl.handle.net/11427/19257 ER - en_ZA


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Creative Commons Attribution 4.0 International (CC BY 4.0) Except where otherwise noted, this item's license is described as Creative Commons Attribution 4.0 International (CC BY 4.0)