The ANC is in discussions with the pension funds industry and the treasury regarding the use of pension funds or retirement savings to finance government’s infrastructure projects.
Godongwana says the proposal will be an incentive for pension fund trustees to “make appropriate decisions” with regard to risk and returns on their investments. ” because they are more affordable than traditional bonds. These bonds also “offer opportunities to promote long-term economic competitiveness and climate resilience”, the party says.
The proposal is that the government invest in energy, water and sanitation; roads and bridges; human settlements; healthcare; education; digital infrastructure and public transport. Other proposals include having the South African Reserve Bank directly funding the same development finance institutions through a R500-billion fund and the creation of more state-owned enterprises in the form of a state bank and a state pharmaceutical company.