Real salaries down by almost four percentage points
South Africans’ salaries have lagged inflation by nearly four percentage points over the past five years, according to a report released this week by payment services house BankservAfrica.
“The average nominal salary, measured in the BankservAfrica Take-home Pay Index, increased from R12 573 in February 2018 to R15 438 in February 2023, showing growth of 22.8%,” said Shergeran Naidoo, BankservAfrica’s head of stakeholder engagements. But the Consumer Price Index was 26.6% over the same period.
“Over the past 18 months, the economic environment has been exceptionally challenging for companies. The rampant loadshedding, high production costs due to escalating fuel prices, weaker currency and rising wage pressures, elevated interest rates and moderating demand have all contributed to the dismal growth,” said independent economist Elize Kruger.
“Companies have indicated a shift from potential expansion and investment to becoming less dependent on Eskom and have redirected capital earmarked for investment towards self-sufficiency. This conservative ‘survival’ approach is not conducive to employment growth in South Africa and keeps a lid on salary increases,” Kruger said.
CIPC wants criminal sanction for non-disclosure of beneficial ownership
The Companies and Intellectual Property Commission (CIPC) is urging the Department of Trade, Industry and Competition to introduce a criminal sanction for the non-disclosure or the incorrect disclosure of the beneficial ownership of companies and trusts, according to a BusinessLive report.
It said CIPC commissioner Rory Voller would like this provision to be included in the Company Amendment Bill, which is expected to be tabled in Parliament later in 2023.
Voller said in an interview that many countries impose criminal sanction for the non-disclosure or incorrect disclosure of beneficial ownership.
He said that in interactions with the CIPC’s counterparts in Mauritius — which recently came off the Financial Action Task Force’s grey list — criminal sanctions were one of the biggest deterrents.
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BHF proposes medical schemes share the risk of funding expensive treatments
The Board of Healthcare Funders (BHF) has proposed setting up a special fund to share the risk of covering extremely expensive medicines. The aim is to buffer schemes from financial shocks that could force them to increase premiums significantly and provide patients with a standardised approach to costly treatments regardless of the scheme to which they belong, BusinessLive reports.
Under the cell-captive arrangement developed by the BHF, participating medical schemes would collectively own an insurance fund created to cover a defined list of medicines, pooling both funds and risk, the BHF’s head of research, Charlton Murove, said.
Schemes would pay an annual contribution at the start of each year, eligible claims would be paid out from the fund, and at the end of the year any remaining money would be redistributed among the participants, said Murove.
The BHF is proposing the mechanism cover 25 of the most expensive medicines per beneficiary per year, costing upwards of R100 000 per patient per year, he said.
Murove said the BHF’s proposal has received a “very positive” response from schemes.
Covering treatments that cost more than R100 000 per patient per year could cost schemes as little as R13 per beneficiary a year, he said.
Work was under way to finalise the costing and regulatory requirements for the proposed fund, Murove said.
