The department of social development says it withdrew the green paper on comprehensive social security and retirement reform so that clarity could be obtained on some of the issues raised.
It plans to release the paper again once those issues have been addressed.
The green paper, which was not approved by the cabinet or Treasury, elicited an outcry of opposition from business and trade unions alike. It was withdrawn by social development minister Lindiwe Zulu in a notice in the government gazette on Tuesday, less than two weeks after it was first gazetted on August 19.
“Since its publication, there has been widespread commentary on the key recommendations entailed in the green paper,” the department said in a statement. “Some of the technical aspects of the proposals were not well understood and many have misrepresented the proposals, particularly the National Social Security Fund (NSSF). It has become apparent that some of these areas need further clarification to avoid any further confusion.”
The department said it was pleased at the level of public discourse over the green paper, which was intended as a discussion paper, as that “reinforces the fact that society should be involved in the policymaking space”.
The motivation for the green paper was what the department regards as the “systemic weaknesses” in the private retirement system, which exclude millions of workers. It estimated that 6.2-million workers with formal jobs have been left out.
One of its more controversial proposals, which drew the ire of trade unions, was the requirement that all employees be mandated to contribute 8%-10% of their qualifying earnings up to R276,000 to a government-run NSSF, which would pool resources to provide retirement, survivor, disability and unemployment benefits.
On the release of the green paper, the Treasury insisted that it was not government policy and that its proposals had not been tested against its tax and fiscal policies. Business also stated that the green paper had not taken into account the views that it had expressed in the National Labour and Economic Development Council (Nedlac), which had been discussing social security reform for the past five years.
In the Nedlac report on the discussions, business expressed dissatisfaction that expert research commissioned from the International Labour Organization (ILO) and others by Nedlac had been disregarded by the drafters of the green paper.
Treasury deputy director-general Ismail Momoniat said the proposals reflected some of the aspirations of the various constituencies in Nedlac which had not reached consensus on it after several years of discussion.
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