However, with millions either outside or poorly covered by the current set-up, the government plans to introduce a comprehensive social security system to protect the income security of the workforce. The new system will be based on four tiers.
Tier 3: Voluntary private provision
Tier 2 (mandatory): Private sector benefit provision via accredited institutions
Tier 1 (mandatory): National Social Security Fund / Basic retirement, death and disability benefits
Tier 0: Social assistance grants / state old age pension, children’s and disability grants
National Health Insurance (NHI)
Healthcare is currently provided by the public and private sector, with the majority of people using the public sector since private medical schemes are beyond their financial means. The government is now proposing to:
• Create a publicly administered and funded National Health Insurance Fund
• Expand health coverage to all South Africans
• Provide comprehensive coverage of health services
• Deliver healthcare publicly and privately
• Promote social solidarity
• Save on excessive administrative costs
Momentum is fully supportive of the social security and healthcare reforms and is contributing to the process by engaging with policymakers, organised labour and other industry players, mostly through the Association for Savings & Investment SA (ASISA).
Momentum believes that it is important to thoroughly assess the potential impacts of the reforms prior to full implementation, and takes the view that careful and phased implementation is required if the reform objectives are to be achieved. The company is committed to ensuring that the most up-to-date information on the reforms is shared with clients, in order to maximise their potential benefits.
Slow going – with more emphasis on health
The social security reform process has slowed considerably. However further papers, covering both social security and healthcare, are expected in the first half of 2010. Momentum anticipates that in future, greater attention will be given to healthcare reform and the establishment of the NHI scheme.
New group benefits division at Momentum
In light of the proposed social security reforms, Momentum has consolidated its various employee benefits divisions into a single new group benefits division with the focus on:
• Providing the best possible solutions to meet clients’ needs
• Simplicity, transparency, value for money and ease of use
• Outstanding service
For further information
please visit www.momentum.co.za