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Vavi threatens action on retirement law

Cosatu would take to the streets if some proposed changes to retirement legislation were not amended, general secretary Zwelinzima Vavi said on Tuesday.

“We should... mobilise for a programme of mass action, including a national strike, if satisfactory steps are not taken to remove potential prejudicial provisions and to strengthen safeguard measures for the interests of retirement fund members.” 

Cosatu had concerns over the Financial Services Laws General Amendment Bill, which was before Parliament, Vavi said in a speech prepared for delivery at Nedlac.

Provisions in the proposed bill, Vavi said, meant financial regulatory institutions such as the Financial Services Board would be exempted from any legal action brought against them by retirement fund members.

Vavi said the proposed amendments would affect millions of pension fund members.

They should not be legislated without thorough public discussion on the matter and detailed engagement with organised labour.

“We should therefore insist that the bill be tabled at Nedlac for tripartite engagement on its provisions, and for it to be amended so that it strengthens, not weakens, the interests of retirement fund members,” Vavi said.

He voiced concerns over a proposal for the mandatory preservation of retirement funds, which would prevent workers from drawing funds before retirement.

It was an insult to workers that organised labour had not been part of consultations with Treasury on the proposals for pension funds, Vavi said.

Turning to the state of the economy, he said higher wages and better social grants would bring greater growth. The country required a stance biased in favour the working class and the poor.

“Higher wages and social grants stimulate demand for goods and services and create a market for new businesses, which in turn employ more people and increases economic growth.” 

He said the economic structure was over-dependent on the export of raw materials. It was being dominated by multi-national monopolies in the mining and banking sectors.

“It must promote and protect [the] locally-based manufacturing industry and renovate our ageing economic infrastructure.” 

Vavi said Brazil had set an example in fighting inequality and poverty by improving social protection, developing public education, and making provision for minimum wage policies.

Social security reform was thus vital in reducing the level of poverty in the country, he said.

Vavi accused the government of taking too long to produce its comprehensive social security policy document.

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