LETTER PUBLISHED IN FINWEEK

Your article , “A New Money World Order” ( Finweek 3/5/12), based on an interview with Mr John Oliphant, Head of Investments and Actuarial at the Government Employee Pension Fund (GEPF), made my hair stand on end.




This gentleman’s proposals to invest our pension funds into “social investments” and “non traditional asset classes” is a recipe for disaster for the 1.2 million pension find members affected, and raises the question as to how Mr Oliphant got his job in the first place. To argue that because Yale and Harvard received above average returns on some of their more unusual investments has got no logical link with the GEPF at all. The GEPF is headed by people such as Mr Oliphant, not by the Yale or Harvard Endowment Funds, who invest in things people can understand, such as real estate and oil and gas – not in "assets” such as Gauteng’s disastrously conceived SANRAL toll road boondoggle, where in its infinite wisdom the GEPF already has sunk R16 billion . The Boards of Harvard and Yale have as their prime goal to protect the interests of their pension fund holders, not to invest in politically inspired white elephants which the private sector will not touch with a bargepole. The stupidity of the analogy is what worries me even more than the analogy itself.



Besides, to manage such portfolios requires high levels of skills the possession of which the SA government itself freely admits it does not have. As for Africa, yes there are good investments to be made, but not if their aim is some kind of pan African pipedream where politics, and not business has priority. You can lose at lot of money in Africa very fast- just ask the SA private sector. Mr Oliphant’s vision, such as it is, conjures up for me a generation of impoverished pensioners eking out a living in their most vulnerable years in a rerun of the Zimbabwe state pension scheme, which was pillaged for political ends and is now not worth the paper it is printed upon.



Dr Gavin Lewis

DA MPL Gauteng Legislature