South Africa. Deflation puts brakes on retired SA public servants’ pensions
For the first time since the 1990s, nearly 15,000 retired South Australian public servants will see their indexed pensions frozen until consumer prices bounce back – but the state Treasurer has intervened to ensure they don’t lose money.
After this year’s record fall in the consumer price index, State Treasurer Rob Lucas has used his legislative discretion to maintain pension payments at their current level to more than 14,300 people in the pre-1986 scheme administered by Super SA. However, the pensions won’t rise again until CPI outstrips the fall in the previous quarter.
The super scheme in question provided an indexed pension based on each member’s time of service, age of retirement and other factors. It closed to new entrants in 1986, later being replaced by a lump sum scheme.
The freeze, rather than a cut, has also been applied to some former MPs, retired judges and former Governors who receive indexed pensions. There are 132 pensioners in the Parliamentary pension scheme (which was closed in 2006), 71 pensioners in the Judges pension scheme, and three in the Governor’s scheme. The scheme for judges and former Governors remains open.
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