Background

The SATAWU National Provident Fund started on 1 February 1995 and is registered as a provident fund with the Financial Services Board and approved by the South African Revenue Service.

All registered funds have rules that provide the legal structure of the fund according to the Pension Funds Act 24 of 1956 (referred to as the Act).

The fund rules can be difficult to understand therefore the board of trustees has issued this information booklet that summarises the rules and insured benefit policies in a more user-friendly manner for fund members.

The objective of the fund is to provide you and your dependants with the best possible benefits in return for contributions paid to the fund during the time that you are a member.

All queries concerning the fund should be directed to your employer or shop steward, who, if unable to assist you, will direct you to the appropriate source so that they can respond accordingly.

Financial provision for retirement is an important objective for employers and their employees. Government also recognises the importance and has established statutory bodies and agencies to regulate, supervise, monitor and oversee the operations and management of retirement funds to ensure members’ benefits are protected.

Two of the most important statutory bodies affecting the fund are:

• the Financial Services Board (FSB);
• South African Revenue Service (SARS).

The FSB requires funds to submit various documents such as audited financial statements on a regular basis and these documents are then used to measure whether funds are operating in accordance with the Act.

The fund is a legal entity separate from the employer and the South African Transport and Allied Workers Union - SATAWU (referred as the “union”).

The fund belongs to the members and is governed by the trustees.  The board comprises of 17 trustees who hold office for a maximum period of four (4) years and may be eligible for re-appointment or re-election.  The trustees will be represented as follows:

The Principal Officer and outgoing trustees will oversee the elections or they may appoint a qualified person to do so.

Each participating employer must appoint one member to attend to fund business.

The trustees may receive limited remuneration if agreed by the board.

The trustees will elect a Chairperson from their ranks to lead the meetings.

The trustees will meet at least two (2) x a year and nine (9) x trustees and the independent trustee will form the quorum.

The trustees will appoint a Principal Officer, an Auditor, a Valuator, a Monitoring Person, an administrator, an insurer and a consultant.  The appointment of the Auditor, Valuator and Principal Officer must be approved by the Financial Services Board.  They also appoint other professionals to assist with their fiduciary duties.

However, even though the trustees appoint the service providers they are still fully responsible for the management of the fund.

The Board members are named in the annual member newsletter each year.

The trustees are charged with a fiduciary duty to act with utmost good faith for the benefit of all the members.

In terms of the Pension Funds Act, a board of trustees must control and manage the fund within the framework of the various laws and principles governing the fund and will be held accountable.

It is the objective of the board of trustees to fulfil its obligations keeping the following in mind:

The fund rules and governing law empower the trustees to:

• To delegate some of their duties but no their overall responsibility towards members
• To invest fund monies with care
• To settle complaints and disputes with members

The fund is an umbrella defined contribution provident fund. An umbrella fund has many participating employers and their employees join the fund as members of the fund.

A defined contribution fund is similar to a savings account – you and your employer pay contributions into the fund on a monthly basis, all costs such as the premiums for the death, disability and funeral benefits, administration fee and other essential costs are deducted, interest (growth on investments) is added to the balance of the contributions as long as you remain a member of the fund.

The fund has a set of general rules that are applicable to all participating employers. Each participating employer has a set of special rules applicable to the participating employer and his employees. The Special Rules set out the eligibility conditions, benefit structure and contribution rates of each participating employer its members.