The fund should wait for the PIC to be sorted out before taking steps to invest elsewhere
With all the revelations — or allegations — about the Public Investment Corporation’s governance failures emerging at the Mpati commission, now might not have been the best time for its biggest client to make a pitch for investing in unlisted vehicles. But that doesn’t necessarily mean it’s a bad idea.
The complication comes in when one considers that the bulk of its money is invested by the PIC, which is mired in scandal. The Mpati commission has already brought to light a number of ethically dubious dealings, even if nobody has yet been accused, let alone convicted, of a crime. Sithole noted that the “unlisted space” is “very small in the scheme of things”. Yet it was in relation to that tiny space, about 5% of the GEPF’s portfolio, that most questions were raised in the commission.
Allowing the fund to invest more offshore should be less controversial, and it’s surprising that talks with the Treasury have gone on for as long as they have. It doesn’t make sense that government employees are prejudiced in relation to workers in the private sector, whose pension funds can invest as much as 30% of their assets offshore.
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