Given South Africa’s enormous infrastructure backlog and urgent need for additional funding, the Batseta Council of Retirement Funds recently partnered with the Gauteng Department of Human Settlements to convene its first infrastructure development workshop for pension fund trustees.
Anne-Marie D’Alton, CEO of Batseta, notes that the workshop aimed to demonstrate to trustees the benefits of investments in infrastructure for both accelerating economic growth and transformation, and better managing portfolios’ risk profiles through diversification.
“Infrastructure development is central to building an efficient and robust economy that in turn impacts the everyday lives of pension fund members. As custodians of the country’s pension savings, the workshop therefore offered trustees an in-depth exploration of the specific attributes of investments in infrastructure, as well as the opportunities available,” she says.
The program was facilitated by the Actuarial Society of South Africa (ASSA), whose members offered delegates the benefit of their unique expertise in pension fund investment strategy and risk management, both at a project management and underlying investment level.
Speaking before delegates at the workshop, Malizole Mdlekeza, Chair of the Alternative Investments Committee at ASSA, noted that investments in housing developments are a social and economic imperative in South Africa, with enormous potential to stimulate job creation, enterprise development and social integration, and alleviate poverty.
Presentations made at the workshop addressed the unique benefits of infrastructure investments for portfolios in terms of diversification and better matching long-term liabilities, as well as complementing the environmental, social and governance responsibilities of trustees in executing their duties as corporate citizens.
The workshop particularly focussed on housing and mega city developments, discussing the unique investment requirements and features that trustees should first consider. Delegates explored housing project investments in relation to investor risk appetite, as well as being presented with a case study demonstrating the cash flow, return profile and use of risk mitigation strategies in an infrastructure project.
Sibusiso Buthelezi, Consultant to GPF: Mega Cities, further offered delegates at the workshop a comprehensive overview of the Gauteng Partnership Fund’s (GPF) own plans in terms of mega city developments, including the GPF’s investment pipeline and funding mechanisms.
“We have expanded the GPF mandate for the creation of a mega project fund to fast track big city developments, including human settlements, public transport and the development of industrial nodes,” he explained. “Pension funds likewise now have an important opportunity to play a role in the development of decent housing for communities where their members live and work.”
“Additional workshops will be held in Cape Town and Kwa Zulu Natal so watch out for the dates which will be published in due course,” adds D’Alton.
Successful participants at the first infrastructure development workshop for pension fund trustees
Batseta is a leading industry body which actively contributes towards the advancement of the retirement fund industry through engaging with appropriate authorities and stakeholders. It undertakes interventions that ensure that consumers are financially literate and protected, that the regulatory environment is conducive to foster a culture of retirement savings and that retirement funds are active owners of the assets under their care.
Batseta aims to contribute towards the personal development and growth of its members in order to provide services of high quality in the interest of retirement fund members and beneficiaries.
Batseta promotes transparency, cooperation and collaboration as well as the highest ethical and governance standards for retirement funds and their fiduciaries.