GEPF Focuses on Infrastructure Investments to Boost Returns in an Uncertain Market

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JEREMY MAGGS: The Government Employees Pension Fund (GEPF) is marking its 30th anniversary while addressing vital issues concerning retirement savings.

The introduction of the two-pot system allows employees to access a portion of their savings earlier, prompting discussions about its effects on the sustainability and adequacy of retirement funds for South Africans.

As Africa’s largest pension fund, GEPF is central to this conversation. We’ll delve into the associated risks, necessary adaptations, and the future of retirement security.

I’m excited to welcome Frans Baleni, chairperson of the Government Employees Pension Fund, to our discussion today. Congratulations, Mr. Baleni, on this significant milestone! Do you view this anniversary as a reflection of the fund’s resilience, or are there still concerns regarding public servants’ retirement security?

FRANS BALENI: We are unwavering in our commitment to protecting the retirement savings of public servants, and I have great confidence in the fund’s performance.

Significantly, the fund has never requested additional support from the National Treasury, which highlights our successful investment strategy over the past 30 years.

JEREMY MAGGS: After three decades of strategic growth, how do you see its evolution amid changing circumstances?

FRANS BALENI: We must continually reassess our approach to align with global trends. Recent tensions in Iran led to a R200 billion drop in our investments in just one week, emphasizing the need to be prepared for such challenges.

Listen/read: GEPF portfolio rises by 13% to R2.69 trillion [Nov 2025]

Additionally, we are focusing on infrastructure development within our investment strategy, as achieving significant returns is crucial for the long-term viability of the fund.

We also need to tackle the economic challenges our nation faces.

The rising unemployment rates stress the urgent need for job creation to enhance pension growth. Establishing job opportunities and boosting contributions to retirement funds is vital for economic progress.

Our ambition extends to exploring prospects beyond South Africa.

During a recent trip to Nairobi, I witnessed remarkable advancements in East Africa. We should take cues from their successes to improve our fund.

JEREMY MAGGS:

FRANS BALENI: Certainly, effective risk management is critical. We need to be cautious since our offerings exclude grants.

I propose establishing a dedicated fund to ensure sustainability from the outset of any project.

Traditionally, we have been strong investors in mining; however, we lacked an exploration fund until recently, which we have now created to support new initiatives.

We are currently adopting measured risks, recognizing that returns may take time.

JEREMY MAGGS: What percentage of members do you anticipate will maintain their living standards post-retirement? Is the fund transparent regarding this issue?

FRANS BALENI: This is a complex matter; many retirees struggle due to substantial family obligations, though many members adapt effectively.

Retiree challenges often arise from financial commitments, such as supporting grandchildren or other family members, which seriously affect their financial stability.

This is why we have expressed concerns about the two-pot system; it complicates the retirement landscape.

JEREMY MAGGS: This brings to light a significant concern. Many view the two-pot system not as a true reform, but as recognition that South Africans urgently need access to their long-term savings due to financial pressures.

Given the current economic climate, reversing this trend seems unlikely.

FRANS BALENI: Indeed, prioritizing job creation and fostering opportunities is essential to alleviate family burdens. This remains a key focus.

Without progress, employed South Africans will face increasing financial challenges.

JEREMY MAGGS: As you mentioned, the fund is closely linked to the South African economy. How challenging will it be to support members in times of low growth and high unemployment?

FRANS BALENI: This drives our strategy to explore opportunities outside South Africa. We are diversifying our investments throughout the continent and into Europe.

Nevertheless, given our commitment to South Africa, we must work diligently to rejuvenate the economy and secure returns for our over 1.7 million members, both active contributors and retirees.

JEREMY MAGGS: Should we consider stricter regulations on members’ access to savings? Would financial counseling, debt relief, or enhanced planning services be beneficial?

FRANS BALENI: We have explored models from the U.S. that allow borrowing under strict repayment conditions. Preventing repeated borrowing could offer advantages.

However, current regulations do not permit such frameworks. Withdrawals remain as they are until legislative changes occur.

JEREMY MAGGS: Tighter preservation laws might be necessary, but could this inadvertently aggravate the situation for workers already burdened by debt, inflation, and family responsibilities?

FRANS BALENI: It’s a delicate balance. The dialogues around the two-pot system were extensive and meticulously considered before reaching a conclusion.

Listen/read:
Financial stress surges as the middle class faces mounting financial challenges [Nov 2025]
Two-pot withdrawals: What does the future hold for the funds? [May 2025]

I initially had reservations about the two-pot system, but I regret that labor unions advocated for member access due to pressing needs.

JEREMY MAGGS: Thank you for sharing your insights, Frans Baleni. It has been a pleasure discussing these crucial issues with you. He is the chair of the Government Employees Pension Fund.