Pension Funds Adjudicator Vuyani Ngalwane wants the government to put an end to the deduction of undisclosed costs from retirement annuities, Business Day reported on Wednesday.
It said he had asked Finance Minister Trevor Manuel to declare such actions an ”undesirable business practice”.
Manuel and Pension Fund Registrar Dube Tshidi should in this way take an active role in the life assurance crisis, Ngalwana said.
The call came as Ngalwana ruled against Metropolitan, which deducted almost all the money put into a retirement annuity by a consumer, Sarah Radebe.
Radebe had saved R2 016, but 89% of this amount was deducted for administration expenses.
Because only R226 was left, Metropolitan wrote this off as a ”lapsed policy” because the amount remaining was considered ”too trivial”.
Ngalwana has issued 20 rulings against life companies this year, taking them to task for deducting charges from people’s annuities while not disclosing these costs beforehand.
On Tuesday, he said Manuel should consider putting an end to these ”undisclosed costs” by declaring an ”undesirable business practice” under the Pension Funds Act.
Such a declaration would outlaw those practices. It would also be more effective than adjudicator rulings that deal with each complaint separately, Business Day reported. – Sapa