To cut costs of pension funds, regulator wants fewer of them
Even though there are fewer than the 13,000 that existed 10 years ago, there are still too many
SA’s financial services watchdog says it is working with the treasury to reduce the number of retirement funds because there are too many of them, keeping costs high.
The Financial Sector Conduct Authority (FSCA) said there are just under 1,500 active funds in SA. Even though that is fewer than the 13,000 that existed 10 years ago, the regulator said there were still too many to achieve the economies of scale they need to cut administration costs.
A study by the FSCA and the treasury showed that large funds provide more value for each rand of members’ money spent on administration and other costs, said Olano Makhubela, the FSCA’s divisional executive of retirement funds supervision...