de beers pension fund 2 of 29 de beers pension fund schedule of rulings ruling refer to rule number...

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DE BEERS PENSION FUND

SCHEDULE OF RULINGS

As at May 2013

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DE BEERS PENSION FUND SCHEDULE OF RULINGS RULING REFER TO

RULE NUMBER APPROVAL DATE & MINUTE NUMBER

1. FUNDING OF PAST SERVICE Funding by Employers for the past service of employees admitted to the Fund shall be in terms

of the following formula: Monthly salary at date of transfer X *17,5 X Number of months previous service worked 1 100 1 *This is always equivalent to the total of the members plus employers contribution rates.

Rule A2.4.2 (Old rule 12.2)

16 June 1987 26.87

2. ADDITIONAL PENSIONS 2.1 NORMAL AND EARLY RETIREMENT The contributions in respect of additional service purchases by members attracts interest at a

rate determined by the Actuary each year. The additional pension payable is calculated as per the following formula: Contributions plus accumulated interest = Total additional annual pension 13,5 However, if a member elects to receive the higher spouse‟s and children‟s pensions in terms of Rule 4.2.5, the additional pension is calculated as follows: Contributions plus accumulated interest = Total additional annual pension 11,717 The member may commute up to 1/3 of the pension.

Rule A2.3.1 & 2 Rule A10.2.1 (Old rule 11.2) Rule A4.2.5

16 June 1987 26.87 31 August 1999 43.99

2.2 ILL HEALTH RETIREMENT The contributions in respect of additional service purchases by members attracts interest at a

rate determined by the Actuary each year. The additional pension payable is calculated as per the following formula: Contributions plus accumulated interest = Total additional annual pension Age-related factor as per Ruling 4 The member may commute up to 1/3 of the pension for all of the above forms of retirement.

Rule A2.3.1 & 2 Rule 10.2.1 (Old rule 11.2)

8 March 2000 10.00.2

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RULING REFER TO RULE NUMBER

APPROVAL DATE & MINUTE NUMBER

3. EARLY RETIREMENTS 3.1 DISCOUNTED PENSION Rule A3.3.1 & 2

(Old rule 13.27) 28 August 1987 33.87.7

a) RULINGS APPLICABLE TO 31 MAY 1990: It was reported that the amount of pension payable to a member who takes an early

retirement under age 55 years shall be determined at 2% of pensionable salary for each year of pensionable service reduced by 0,5% for each month of uncompleted service to normal retirement age. A member who retires in terms of this rule is entitled to the annual bonus pension awarded to pensioners.

In the case of female members who elected a retirement age of 55. They may proceed on early retirement at any age between 50 and 55, but they will not be grated any increase in their pension until they reach the ages of 55.

27 October 1987 44.87.2

b) RULING APPLICABLE FROM 01.06.90: Members 50 years of age and older, who retire in terms of Rule A3.3.2 will receive a

pension discounted by nought point five per cent (0,5%) for each month of uncompleted service to normal retirement age. These pensions will attract the annual increases awarded to pensioners.

22 February 1990 3.90

Members 55 years of age and older, who retire in terms of Rule A3.3.2 after 6 June 1996 will receive a pension discounted by nought point two five per cent (0,25%) for each month of uncompleted service to normal retirement age. These pensions will attract the annual increases awarded to pensioners.

6 June 1996 15.96.6

In the case of female members who joined the Fund before the first day of May 1979 and who elected to retire at the age of 55 years may proceed on retirement in terms of Rule A3.3.2, at any age between 50 and 55 and may elect to take an undiscounted pension with no annual increases until they reach the age of 55 or receive a pension discounted by nought point two five per cent (0,25%) for each month of uncompleted service to normal retirement age, this pension will attract the annual increases awarded to pensioners.

5 September 1996 33.96.3

c) RULING APPLICABLE FROM 01.03.98: Members 50 years of age and older, who retire in terms of Rule A3.3.2 will receive a

pension discounted by nought point five per cent (0,5%) for each month of uncompleted service to age 55 and nought point two five per cent (0,25%) to normal retirement age. These pensions will attract the annual increases awarded to pensioners.

24 February1998 5.98.3

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RULING REFER TO


3.2 UNDISCOUNTED PENSION Rule A3.3.1 & 2 (Old rule 13.27)

16 June 1987 26.87

a) RULING APPLICABLE TO 31 MAY 1990: Members who take an early retirement at age 55 years or over will not be entitled to the

annual bonus awarded to pensioners until the member reaches normal retirement age.

b) RULING APPLICABLE FROM 1 JUNE 1990: Members at the age of fifty-five (55) years or older who retire in terms of Rule A3.3.2

will be entitled to elect at their option an undiscounted pension. These pensions will not attract the annual increases awarded to pensioners until the member reaches the normal retirement age.

22 February 1990 3.90

4. COMMUTATION FACTORS

AGE FACTOR AGE FACTOR AGE FACTOR Late retirement 13.500 Normal retirement 13.500 Early retirement 13.500 Ill-health retirement 60 13.500 48 9.319 36 6.095 59 13.140 47 8.992 35 5.875 58 12.780 46 8.666 34 5.694 57 12.421 45 8.339 33 5.513 56 12.061 44 8.066 32 5.332 55 11.701 43 7.793 31 5.151 54 11.355 42 7.521 30 4.970 53 11.009 41 7.248 52 10.664 40 6.975 51 10.318 39 6.755 50 9.972 38 6.535 49 9.645 37 6.315

Rule A4.2.1 & 2 (Old rules 14.9.1 & 14.9.2)

16 June 1987 26.87

The factor to be used for Members who elect to receive a higher Widow / Widower and Child‟s pension in terms of Rule A4.2.5, shall be 11,717.

Rule A4.2.5 5 June 1998 11.98.6.3.2

5. INTEREST ON DEATH BENEFIT ANNUITIES Interest at a rate to be determined by the Trustees from time to time will be credited to the

dependants death benefit account on the balance standing to their credit. Rule A5.2.3 (Old rule 13.11.2 (c))

16 January 1992 9.92

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RULING REFER TO


6. INTEREST RATE ON CONTRIBUTIONS a) RULING APPLICABLE FROM JULY 1991 TO SEPTEMBER 1996 The rate of interest payable on members' contributions shall be established on the last working

day of each month and is based on the average of 8 specified financial institutions. Def : Accumulated Contributions (Old rule 3.1)

18 July 1991 41.91

b) RULING APPLICABLE FROM SEPTEMBER 1996 The rate of interest on contributions be calculated every 6 months and that this be based on the

average rate of the four major banks in respect of the 6 month fixed term deposits. Def : Accumulated Contributions (Old rule 3.1)

7. LATE RETIREMENT APPLICABLE FROM 1 JUNE 1990 a) In the case of a deferred pension, the pension will not share in annual bonus pensions

but will be increased by 1% for each completed month from normal retirement date to actual retirement date.

Rule A3.5.2 (b) (Old rule 13.10 (b))

22 February 1990 3.90

b) Where a member elects to continue contributing after normal retirement age, the pension shall be increased by 0,25% for each completed month from normal retirement date to actual retirement date.

Rule A3.5.2 (c) (Old rule 13.10 (c))

22 February 1990 3.90

8. DEFERRED PENSIONS (Other than those deferred on retirement in terms of Rule A3.5.2 (b))

Between the date of deferment and normal pension age, deferred pensions shall be increased on the same basis and at the same rate as the annual increases granted to pensioners.

Rule A8.4.1, 2 & 3 (Old rule 13.26)

8 November 1989 31.89.1 (a)

9. FACTORS FOR MEMBERS ACCRUED PENSIONS ON WITHDRAWAL

Table with effect from 1 December 2000. AGE AGE AGE AGE 59 13.2022 49 10.0876 39 7.7078 29 5.8894 58 12.8517 48 9.8198 38 7.5032 28 5.7331 57 12.5105 47 9.5591 37 7.3040 27 5.5809 56 12.1783 46 9.3053 36 7.1100 26 5.4327 55 11.8550 45 9.0582 35 6.9213 25 5.2885 54 11.5403 44 8.8178 34 6.7375 24 5.1481 53 11.2339 43 8.5837 33 6.5587 23 5.0114 52 10.9357 42 8.3558 32 6.3845 22 4.8783 51 10.6453 41 8.1339 31 6.2150 21 4.7488 50 10.3627 40 7.9180 30 6.0500 20 4.6227

Rule A8.1.1 (Old rule 13.22 (a))

6 December 1999 61.99

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RULING REFER TO


The preservation amount of Members who had transferred to the Fund from either the Anglo American Pension Fund or the De Beers Industrial Group Pension Fund on either 1 March 1998, 1 April 1998 or 1 July 1998, shall be subject to a minimum of the Rand value of the benefit they would have received had they left on the transfer date, based on the salary and service as at that date.

10. RE-INSTATEMENT OF WIDOWS PENSIONS Agreed to re-instate suspended pensions at the rate the pension would have been had the

pension continued. Re-instatement date : 01 June 1990

(Old rule 13.13.2 (a))

28 June 1990 26.90

11. EARLY RETIREMENT BETWEEN AGES 55 – 60 Where a member elected a "no increase" early retirement, then this will apply to the total

pension inclusive of voluntary additional pension. Rule A3.3.1 & 2 (Old rule 13.27)

28 June 1990 30.90

12. UNDERGROUND WORKERS – EARLY RETIREMENTS a) Discounting will apply from actual retirement date to the adjusted (underground

service) date. Rule A3.3.1 & 2 (Old rule 13.27)

28 June 1990 31.90

b) Increases will apply from the adjusted date. 13. HOLIDAY LEAVE ALLOWANCES (SECONDEES) Secondees salary payable in RSA would be deemed to include the HLA and secondees would

contribute 7,5% of the "home based" salary. Rule A9.3.2 (Old rule 3.17.2)

28 June 1990 26.90

14. LATE PAYMENT OF COMMUTATION Agreed to pay interest at the rate applicable to death benefit annuities and additional voluntary

contributions. 30 August 1990

44.90 15. REFUND OF DEFERRED PENSION On the withdrawal of a members' interest in the Fund subsequent to deferring his pension the

member shall be entitled to the benefit that would have been determined at the original deferment date in terms of Rule A8.0.0 "WITHDRAWAL BENEFITS".

Rule A8.4.1, 2 & 3

20 January 1995 4.95

The benefit will accrue interest from the date of the original deferment to the date of payment at the annual rate of interest applicable to death benefit annuities.

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RULING REFER TO


16. RETRENCHMENTS Eligibility of deferring a pension

Retrenchees those service is greater than five years may defer their pensions, effective 1 June 1990 (Rule No. A8.2.1 and A8.4.0).

22 February 1990 2.90.2.9

Members who are 55 years or older and who are retrenched from the service of an employer may elect to receive a pension and that no discounting will be applied to their pensions and the members will be entitled to all pension increases.


19 March 1992 16.92.1 Amended : Trustees resolution 23 October 1992

This ruling will remain in force until 31 December 1993. Subject to specific directives from the Company, this ruling is extended to 30 June 1994.

9 September 1993 55.93

Ruling amendment: a) The cut off date of 30 June 1994 to be extended indefinitely. 20 January 1994

4.94 b) All retrenchments must be authorised by the General Manager of the office/mine where

the member is employed. 14 April 1994

13.94.9 17. RETRENCHMENTS – 1992 - KIMBERLEY AND PREMIER MINES Members who are 50 years of age and older who are retired from Kimberley and Premier Mines

during 1992, may elect to receive a pension either with no discounting and no increases until age 55 or, the pension being discounted to age 55 and all pension increases being granted.

Rule A3.3.1 & 2 (Old rule 13.27)

29 April 1992 Trustees resolution Replaced by Ruling 21 23 October 1992 Trustees resolution

18. INTEREST ON WITHDRAWAL Interest is to be paid on the "Cash value" of withdrawals during the three month waiting period

following resignation or retrenchment. The interest applied to accumulated member‟s contributions in the month of withdrawal from the Fund will be the interest rate applied to the cash value of withdrawals for the three months waiting period.

Rule A8.1.1 Rule A8.3.2 (Old rule 13.22 & 13.23)

5 March 2002 5.02.4

19. CHILD/STUDENT PENSIONS The last day of the month in which the child/student turns 18/25 years old shall be deemed to

be the last day for which he/she shall receive a pension. Rule A7.2.0 (Old rule 13.13)

13 August 1992 49.92

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RULING REFER TO


20. APPORTIONMENT OF THE PRESERVED WITHDRAWAL BENEFIT The calculation of the portion of the withdrawal benefit that may be preserved shall be

determined according to the following formula. X = Y - (Y x C) Z Where: X=Preserved apportioned benefit Y=Preserved withdrawal benefit Z=Cash withdrawal benefit C=Amount elected to be paid in cash

Rule A8.0.0 (Old rule 13.22 & 13.23)

13 August 1992 53.92

This ruling applies only in respect of transfers to approved retirement annuities and pension funds. Apportionment of the preserved withdrawal benefits in respect of transfers to approved preservation funds is not permitted.

7 December 2000 45.00.5.3

21. RETRENCHMENTS (AGES 50 TO 55) For the ensuing period ending 31 December 1993, members between the ages of 50 and 55,

may elect to receive a pension on the basis of either: Rule A3.3.1 & 2 (Old rule 13.27)

23 October 1992 Trustees resolution

a) No discounting and no pension increases until age 55, or b) Discounting of 0,5% per month from retirement date to age 55 with all pension

increases being granted.

Subject to specific directives from the Company, this ruling is extended to 30 June 1994. Ruling amendment:

9 September 1993 55.93

a) The cut-off date of 30 June 1994 to be extended indefinitely. 20 January 1994 4.94

b) All retrenchments must be authorised by the General Manager of the office/mine where the member is employed.

14 April 1994 13.94.9

22. CHILD'S PENSIONS In circumstances where a child whose guardian is not in receipt of a pension from the Fund and

that child's pension would be reduced as a result of the adjustment to widow/widower pensions made on 1 August 1992, that child's pension shall not be reduced to allow for the increase given to a widow/widower.

Rule B2.11.3 (Old rule 14.8)

12 November 1992 70.92

23. ADVANCES MADE ON DEATH BENEFITS Management may advance to the widow or widower of a member who has died in service an

amount, to cover funeral expenses, subject to a maximum of 10% of the member's death benefit.

Rule A5.1.1 (Old rule 13.11.1)

10 June 1993 38.93

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RULING REFER TO


24. UNPAID LEAVE – WAIVER OF CONTRIBUTIONS a) Members who take unpaid leave will be granted a period of one month from the date

they return from such leave in which to elect and advise the Fund, in writing, whether they wish to contribute to the Fund in respect of the unpaid leave period. They will then be granted a further period of two months in which to effect payment. Failure to do so, will be deemed to be an election not to contribute and the amount of the pension to which the member would become entitled under the rules would be reduced accordingly.


4 November 1993 63.93

b) The Trustees will only decide on the eligibility regarding the death benefit should the member die whilst on unpaid leave.

c) The member must be advised in writing of his rights in terms of this ruling. 25. DELETED 26. CHILDREN'S PENSIONS – OVER THE AGE OF 18 YEARS For the purposes of interpreting Rule A7.2.1(b) the Trustees agreed that management must

exercise their discretion in the interpretation of what constitutes "formal study at an educational institution approved by the Trustees".

Rule A7.2.1 8 September 1994 41.94

27. EARLY RETIREMENT OF MIGRANT EMPLOYEES WHO WERE ON AN ALLOWANCE SCHEME The penalties applicable to early retirement shall not be imposed on migrant employees who

would have been eligible to retire at age 55 in terms of an allowance scheme and were in service on 1 June 1979 and who elect to retire between the ages of 55 and 60 years. [Refer to minute dated 18 October 1979].

Rule A3.3.2 20 January 1995 5.95

28. ILL-HEALTH APPLICATIONS - PAYMENT FOR SPECIALIST OPINIONS Management may at its discretion obtain opinions from specialists concerning the validity of

certain ill-health applications, the costs of which shall be treated as an expense against the Fund.

Rule A3.4.0 5 June 1995 18.95

29. DEATH BENEFIT – DISTRIBUTION AND PAYMENT That management follows the decision tree as set out on Annexure 1 to the ruling.

(Annexure 1) Section 37C of the Act

5 September 1996 33.96.5.4

30. PRESERVATION FUNDS Ex-members who wish to preserve their withdrawal benefit in a preservation fund may do so in

any such fund that provides in their rules a provision stipulating the extent to which withdrawals may be made before retirement. The minimum age prior to which an ex-member may not be allowed to make any withdrawals shall be 55.

Rule A8.3.0 3 September 1998 30.98

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RULING REFER TO


31. BAD DEBTS The Trustees resolved that management were authorised to approve write-offs below an

amount of R4987. B1.3.3 20 March 2013,

Management is authorised to write off small debts owing to the Fund where the individual

amount does not exceed R2 000,00. Rule B1.3.3 2 September 1997

36.97 32. INTEREST RATE ON LATE PAYMENTS The interest rate applicable to late payments shall be the rate applicable to the Fund‟s Standard

Bank cash management arrangement as at the end of each month (or nearest working day) effective from the 1st day of the following month and shall be used for the whole of that month. (E.g. if the rate is 3.5% on 30 September then the rate to be used for the period 1 October to 31 October shall be 3,5%)

20 September 2012 57.12.2

A register shall be maintained of all rates so determined.

The interest rate to be used shall be the 32 day call deposit rate at Standard Bank as at the 15th of each month (or nearest working day) effective from the 1st day of the following month and shall be used for the whole of that month. (E.g. if the rate is 12,5% on 15 October 1998 then the rate to be used for the period 1 November to 30 November 1998 shall be 12,5%)

4 December 1998 36.98.8

A register shall be maintained of all rates so determined. Simple interest rates will be utilised with the interest being capitalised annually from the date the payment first became due and payable. All calculations must be dated and signed.

33. MAXIMUM MONTHLY REMUNERATION This ruling was withdrawn by the Trustees 23 June 2011

30.11.13.1 The regular monthly remuneration limit for children who are older than 18 years of age and are

eligible for a child‟s pension in terms of Rule 7.2.1. (b) be increased from R1305.00 to R1347.00 with effect from 1 March 2011.

Rule A7.2.1(b) 24 March 2011 18.11.1

34. PROCEDURE TO BE FOLLOWED IN ORDER TO CONSTITUTE THE BOARD OF TRUSTEES The seven Elected Trustees shall be nominated/elected as follows:

a) Four shall be nominated by the National Union of Mineworkers (NUM) representing Members who are

members of NUM, and Pensioners who were Members of NUM at the date of their retirement: Provided that at least one of the four nominees shall be a NUM Pensioner.

b) One shall be elected by Members who are not members of NUM. c) Two shall be Pensioners elected by Pensioners who were not members of NUM at the date of

retirement or NUM pensioners who elect in writing to not be represented by NUM.

Rule B1.3.5 September 2010 62.10

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The electoral official shall be the internal auditor to the Fund. The electoral official shall review the election process in totality and, if satisfied, certify the election to have been procedurally free and fair and list the names of the person/s nominated/elected as Trustees. The certificate and list of names shall be submitted to the Trustees.

Provided that in respect of both nominated and elected Member (including Pensioner) Trustees in each constituency (as specified in (ii) below), the following shall apply –

(i) The electoral official in collaboration with the Principal Officer shall apply the nomination procedure

whereby it is required that a nomination form be signed by three Principal Members/Pensioners from the relevant constituency.

(ii) Trustees will be chosen/voted for from three constituencies as follows –

(i) Four Trustees from the NUM constituency, at least one of which must be a NUM Pensioner. This process will be administered by NUM and NUM will supply the Principal Officer with the names of the Trustees;

(ii) One Trustee from the Non-NUM active Member constituency; and (iii) Two Trustees from the Non-NUM Pensioner constituency.

(iii) The electoral official in collaboration with the Principal Officer shall conduct the election where

applicable by secret / mail ballot. (iv) In the event of more than one candidate being nominated for each Trustee vacancy in a

constituency, an election as detailed above shall follow for the appointment of Trustees. (v) Candidates receiving the highest number of votes in each constituency shall be elected to fill the

Trustee vacancies: Provided that in the event of a tie in the final number of votes cast, lots shall be drawn by the Principal Officer in the presence of the electoral official to determine the successful candidates.

(vi) In the event of the number of nominated candidates not exceeding the number of Trustee vacancies

for a particular constituency, those persons nominated will automatically be appointed to the vacancies without the need for any vote.

(vii) The electoral official shall, following an election, retain a full record of the nominated candidates and

the number of votes cast in each constituency for a period of three years. (viii) Any vacancy that arises among the Member-elected Trustees in a constituency shall be filled as

contemplated in the rules.

The board may at any stage decide whether it is necessary to appoint alternate trustees and if so, may decide the number of alternate trustees that are necessary and the process that is to govern their appointment/election.

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Candidates who have been nominated will be required to sign the declaration approved at the June meeting.

The seven Elected Trustees, their primary and secondary alternates, shall be nominated/elected as follows: d) Three shall be nominated/elected by the National Union of Mineworkers (NUM) representing Members who are

members of NUM, and e) One shall be nominated/elected by NUM representing Pensioners who were members of NUM at the date of

retirement and f) Two shall be elected by Members who are not members of NUM, and g) One shall be a Pensioner elected by Pensioners who were not members of NUM at the date of retirement. The Trustees shall, jointly by majority vote, appoint the electoral official who shall issue a certificate stating that a nomination has been made or an election had been held. The official shall list the names of the person/s elected as Trustees and alternate Trustees and shall certify an election to have been procedurally free and fair, which certificate shall be submitted to the Trustees. Provided that in respect of both nominated and elected Member (including Pensioner) Trustees in each constituency (as specified in (ii) below), the following shall apply – (i) The electoral official in collaboration with the Principal [Executive] Officer shall apply the nomination

procedure whereby a nomination form is signed by [10] 3 Members/Pensioners from the relevant constituency. (ii) The Members will vote within 4 constituencies for their representatives as follows –

(iv) 3 active NUM member representatives; (v) 1 NUM pensioner representative; (vi) 2 Non-NUM active member representatives; (vii) 1 Non-NUM pensioner representative.

(iii) The electoral official in collaboration with the Principal Officer shall conduct the election by secret /

correspondence ballot. (iv) The appointment of primary and secondary alternates in each constituency shall be subject to the number of

the nominated candidates exceeding the number of Trustee vacancies. (v) In the event of more than one candidate for each Trustee vacancy in a constituency, an election as detailed

above shall follow for the appointment of Principal Trustees and their primary and secondary alternates; (vi) Candidates receiving the highest number of votes in each constituency shall be elected to fill the Principal

Trustee vacancies: provided that in the event of a tie in the final number of votes cast, lots shall be drawn to determine the successful candidates;

(vii) Any excess of candidates over vacancies in a constituency shall be appointed (based on the number of votes

cast) to substitute each Principal Trustee. The excess will first be used to fill the positions of primary alternates for each Principal Trustee and thereafter the positions of secondary alternates: Provided that incumbents with no primary and/or secondary alternates, shall personally make appropriate appointments and if they fail to do so, these alternates will be appointed by the Principal Employer. (See also (xi and xii) below applicable to excess candidates).

B1.3.5 June 2007, 41.07

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(viii) In the event of the number of candidates not exceeding the number of Principal Trustee vacancies, those

nominated are automatically appointed to the vacancies: the shortfall in the number of elected candidates for the primary and secondary alternate positions shall in such event be filled by persons nominated by the Principal Trustee. Where alternates fail to be thus appointed, the Principal Employer will appoint alternates.

(ix) In the circumstances alluded to in subparagraph (viii) above, all primary and secondary alternates will –

in the case of the 2 NUM constituencies, be appointed by NUM; and in the case of the 2 non-NUM constituencies, be appointed by the incumbents

personally;

to substitute in their stead so as to ensure that every member-constituency is appropriately represented for the purpose of meetings.

Where alternates fail to be thus appointed, the Principal Employer will appoint alternates.

(x) In the event that the number of candidates is insufficient to fill all the Principal Trustee vacancies in a

constituency, then these vacancies will be filled as follows: in the 2 NUM constituencies, by appointments made by NUM, or failing NUM by the

Principal Employer; and in the 2 non-NUM constituencies, by appointments made by the Principal Employer;

The primary and secondary alternates in respect of these principal Trustees vacancies will be filled as in subparagraph (ix) above.

(xi) The electoral official shall, following an election, retain a full record of the nominated candidates and the

number of votes cast in each constituency for a period of 3 years. (xii) Should a vacancy arise among the Member Trustees in a constituency during the term of office of an appointed

Trustee for any reason, the nominee who had the next most number of votes in the immediate preceding election and/or had been appointed as primary or secondary alternates by the departing Trustee shall be appointed to the vacancy and shall hold office for the remainder of the original Trustee‟s term of office.

NOTE: A REFERENCE TO PENSIONER(S) BELOW SHALL INCLUDED DEFERRED

PENSIONERS AND PAID-UP PENSIONERS The seven Elected Trustees, their primary and secondary alternates, shall be nominated/elected as follows: h) Three shall be nominated/elected by the National Union of Mineworkers (NUM)

representing Members who are members of NUM, and i) One shall be nominated/elected by NUM representing Pensioners who were members of

NUM at the date of retirement and j) Two shall be elected by Members who are not members of NUM, and k) One shall be a Pensioner elected by Pensioners who were not members of NUM at the date

Rule AB.1.3.5 12 June 2001 20.01.7

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of retirement. The Trustees shall, jointly by majority vote, appoint the electoral official who shall issue a certificate stating that a nomination has been made or an election had been held. The official shall list the names of the person/s elected as Trustees and alternate Trustees and shall certify an election to have been procedurally free and fair, which certificate shall be submitted to the Trustees.



Provided that in respect of both nominated and elected Member (including Pensioner) Trustees in each constituency (as specified in (ii) below), the following shall apply – (i) The electoral official in collaboration with the principal officer shall apply the nomination

procedure whereby a nomination form is signed by 10 Members/Pensioners from the relevant constituency.

(ii) The Members will vote within 4 constituencies for their representatives as follows –

(viii) 3 active NUM member representatives; (ix) 1 NUM pensioner representative; (x) 2 Non-NUM active member representatives; (xi) 1 Non-NUM pensioner representative.

(iii) The electoral official in collaboration with the Principal Officer shall conduct the election

by secret / correspondence ballot. (iv) The appointment of primary and secondary alternates in each constituency shall be subject

to the number of the nominated candidates exceeding the number of Trustee vacancies. (v) In the event of more than one candidate for each Trustee vacancy in a constituency, an

election as detailed above shall follow for the appointment of principal Trustees and their primary and secondary alternates;

(vi) Candidates receiving the highest number of votes in each constituency shall be elected to

fill the principal Trustee vacancies: provided that in the event of a tie in the final number of votes cast, lots shall be drawn to determine the successful candidates;

(vii)Any excess of candidates over vacancies in a constituency shall be appointed (based on the

number of votes cast) to substitute each principal Trustee. The excess will first be used

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to fill the positions of primary alternates for each principal Trustee and thereafter the positions of secondary alternates: Provided that incumbents with no primary and/or secondary alternates, shall personally make appropriate appointments and if they fail to do so, these alternates will be appointed by the Principal Employer. (See also (xi and xii) below applicable to excess candidates).



(viii)In the event of the number of candidates not exceeding the number of principal Trustee

vacancies, those nominated are automatically appointed to the vacancies: the shortfall in the number of elected candidates for the primary and secondary alternate positions shall in such event be filled by persons nominated by the Principal Trustee. Where alternates fail to be thus appointed, the Principal Employer will appoint alternates.

(ix)In the circumstances alluded to in subparagraph (viii) above, all primary and secondary

alternates will –

in the case of the 2 NUM constituencies, be appointed by NUM; and in the case of the 2 non-NUM constituencies, be appointed by the incumbents

personally;

to substitute in their stead so as to ensure that every member-constituency is appropriately represented for the purpose of meetings.

Where alternates fail to be thus appointed, the Principal Employer will appoint alternates.

(x) In the event that the number of candidates is insufficient to fill all the Principal Trustee

vacancies in a constituency, then these vacancies will be filled as follows:

in the 2 NUM constituencies, by appointments made by NUM, or failing NUM by the Principal Employer; and

in the 2 non-NUM constituencies, by appointments made by the Principal Employer;

The primary and secondary alternates in respect of these principal Trustees vacancies will be filled as in subparagraph (ix) above.

(xi) The electoral official shall, following an election, retain a full record of the nominated

candidates and the number of votes cast in each constituency for a period of 3 years. (xii) Should a vacancy arise among the member Trustees in a constituency during the term of

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office of an appointed Trustee for any reason, the nominee who had the next most number of votes in the immediate preceding election and/or had been appointed as primary or secondary alternates by the departing Trustee shall be appointed to the vacancy and shall hold office for the remainder of the original Trustee‟s term of office.



35. PENSION INCREASES “Taking into account the requirements of the Pension Funds Act, the Fund aims to grant a

pension increase to existing pensioners and deferred and paid up pensioners on 1 January each year, subject to the affordability thereof by the Fund as determined by the Trustees. The annual pension increase is targeted, but not guaranteed, to be equal to the year-on-year increase in the "Headline" Consumer Price Index (as published by the South African Department of Statistics) up to the preceding 30 September.” Defined Benefit pensioners that have been on pension for less than 12 months as at the pension increase date will receive an increase pro–rated in accordance with the period following their attainment of the age of 55 or 60 (whichever is applicable). The pro-rated basis means that if the new pensioner had been in receipt of a pension for 5 months at the date of the first increase in his or her pension, he or she will receive an increase equal to 5/12th of the pension increase granted at that date. It is specifically provided that for members who retire before the age of 55 (in terms of retrenchment conditions) and between the ages of 55 and 60 (standard early retirement conditions) and who elect to receive no pension increase up to age 55 or age 60 (whichever is applicable), the first pension increase received after he/she turns 55 or 60 (whichever is applicable) will be pro-rated based on the period from the date of the attainment of age 55 or age 60 (whichever is applicable) to the applicable pension increase date.” It is noted that the DC Pensioner Pool will be merged with the DB pensioner pool with effect from 1 November 2008 The DC pensioners so merged will receive a pro rated increase for the period they have been on retirement subject to a maximum period of 6 months counting if the pensioner retired on or before 30 June 2008.

Rule A4.3.0 17 September 2008, 58.08

Taking into account the requirements of the Pension Funds Act, the Fund aims to grant a pension increase to existing pensioners and deferred and paid up pensioners effective from 1 January each year, or effective from such other date that the Trustees may decide, subject to the affordability thereof by the Fund as determined by the Trustees. The annual pension increase considered for implementation annually on 1 January is targeted, but not guaranteed, to be equal to the year-on-year increase in the "Headline" Consumer Price Index (as published by the South African Department of Statistics) up to the preceding 30

March 2009 22.09

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September.” [Defined Benefit] Pensioners that have been on pension for less than 12 months as at the pension increase date will receive an increase pro–rated in accordance with the period following their attainment of the age of 55 or 60 (whichever is applicable). The pro-rated basis means that if the new pensioner had been in receipt of a pension for 5 months at the date of the first increase in his or her pension, he or she will receive an increase equal to 5/12th of the pension increase granted at that date. It is specifically provided that for Defined Benefit section pensioner members who retire before the age of 55 (in terms of retrenchment conditions) and between the ages of 55 and 60 (standard early retirement conditions) and who elect to receive no pension increase up to age 55 or age 60 (whichever is applicable), the first pension increase received after he/she turns 55 or 60 (whichever is applicable) will be pro-rated based on the period from the date of the attainment of age 55 or age 60 (whichever is applicable) to the applicable pension increase date.” For any increase prior to 1 July 2009, pensioners who were members of the Defined Contribution section who were in receipt of a pension as at 1 July 2008 will have their increase prorated for the period 1 July to the date of the increase. Defined Contribution pensioners who went on retirement after 1 July 2008 will have their increase prorated in the same manner as Defined Benefit pensioners. [It is noted that the Defined Contribution Pensioner Pool will be merged with the Defined Benefit pensioner pool with effect from 1 November 2008 The Defined Contribution pensioners so merged will receive a pro rated increase for the period they have been on retirement subject to a maximum period of 6 months counting if the pensioner retired on or before 30 June 2008.]”

In granting pension increases, the Trustees will act on the advice of the Actuary, taking into account, but not bound by, the increase in the official consumer price index for the year to 30 September each year.

Rule A4.3.0 6 December 1999 39.99

Refer to the Pension Increase Policy 24 March 2011 06.11.7

36. INCREASES TO PAID-UP PENSIONS Increases to paid-up pensioners shall be made each year at the average rate of salary increase

pertaining to the grading band applicable to each paid-up pensioner at the time he/she became a paid-up pensioner.

Rule A9.1.0 6 December 1999 60.99.

37. ILL-HEALTH RETIREMENT : DETERMINATION OF BENEFIT In respect of members who joined the Fund prior to 4 December 2001, if a member receives

an ill-health retirement benefit in terms of rule A3.4.5, provided he has at least three years pensionable service, projected service shall be taken into account in the determination of his

Rule A3.4.5 4 December 2001. 74.01.1

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benefit. If a member who joined the Fund after 4 December 2001 receives an ill-health retirement benefit in terms of rule A3.4.5, projected service will not be taken into account in the determination of his benefit.

38. DEATH BENEFITS – DEATH IN SERVICE In respect of members who joined the Fund prior to 4 December 2001, if a member dies in

terms of this rule, provided he as at least three years pensionable service, the increased benefit in terms of rule A5.1.1 (a) shall be payable. If a member who joined the Fund after 4 December 2001 and dies and is due a benefit in terms of A5.1.1 (b) the increase benefit in terms of rule A5.1.1 (a) shall not be payable.

Rule A5.1.1(b) 4 December 2001. 74.01.2

39. SETTING UP OF PENSIONS Where the member elects to purchase a “life annuity” with the full value of his retirement

benefits (less any commutation amount), then the Trustees require the member to provide in the purchased pension for: A spouse pension of at least 50% of the pension (if married at retirement) future pension increases Where the member elects to purchase a “living annuity”, with the full value of his retirement benefits (less any commutation amount), then the Trustees require a member declaration indicating that financial advice has been obtained and that the member understands the financial and mortality risks associated therewith.

Rule B1.12.0 12 September 2000 38.00



40. RECOGNITION OF WIDOW/WIDOWER PENSIONS That, for the payment of widow/widower pensions the Fund recognises relationships of mutual

dependency with the MEMBER, living together as if married with the commitment of doing so permanently and had been so cohabiting for 1 year or more.

Definition of WIDOW/ WIDOWER

7 December 2000 61.00.7

41. CESSATION OF CHILD‟S PENSION Payment of the extended benefit would be subject to –

proof of enrolment bi-annually; submission of passrates/symbols annually continuation of payment would cease on failure in 2 consecutive years of study.

Rule A7.2.1 (b) 7 March 2001 3.01.8

42. APPLICATIONS FOR ILL-HEALTH RETIREMENT The ill-health sub-committee be permitted to review applications and decide on the awarding

of ill-health retirements in line with the following guidelines – Rule A3.4.1 7 March 2001

7.01.1.1

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1. Independent medical report(s) must be obtained to establish the extent of the

disablement (i.e. permanent, temporary, chances of full recovery and/or rehabilitation);

2. Funds‟ medical consultant to express an opinion based on the report(s) and findings; 3. Sub-committee‟s final decision as to payment/declining of claim to be decided by

consensus by all sub-committee members by signature of the decision. Provided that each case would finally be determined on its own merits and that these guidelines would constitute no more than general policy provisions to be applied equitably to each case referred to the sub-committee.



43. APPLICATIONS FOR CHILD CONTINUATION PENSIONS BY PHYSICALLY OR MENTALLY HANDICAPPED CHILDREN OF DECEASED MEMBERS

The ill-health sub-committee be permitted to review applications for life child pensions and extend payment where the child is physically or mentally handicapped in line with the following guidelines – 1. An independent medical report as to the level of incapacity and permanency of the

medical condition; 2. The Funds‟ medical consultant to express an opinion based on the report; 3. The sub-committee‟s final recommendation as to continuation of a child‟s pension to be

decided by consensus by all sub-committee members by signature of the decision. Provided that each case would finally be determined on its own merits and that these guidelines would constitute no more than general policy provisions to be applied equitably to each case referred to the sub-committee.

Rule A7.2.1 (b) 7 March 2001 7.01.1.2

44. ANNUAL PENSIONER BONUS With effect from December 1998 the Trustees in line with Rule A4.3.0 approved an annual

bonus equivalent to 60% of monthly pensions in payment in lieu of a special 5% pension increase.

A4.3.0 13 September 2001 50.01.1

45. PURCHASE OF AN ANNUITY FROM AN OUTSIDE INSURER ON RETIREMENT Members retiring in terms of rules A3.2.0 (Normal retirement), A3.3.0 (Early retirement

from age 50) and A3.5.0 (Late retirement after age 60 up to 65) may elect to purchase a pension from an insurer in terms of rule B1.12.2 at the date of retirement. Members retiring in terms of A3.4.0 (ill health retirement) may not elect this option. The amount available for the purchase of a pension from an insurer is determined as follows:

A. Members who elect not to receive any pension from the Fund.

B1.12.0 25 March 2010, 19.10

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Where as a result of the member‟s election no pension will be payable from the Fund, the amount available to purchase a pension will be determined by applying the member‟s early retirement pension (without the early retirement adjustment) or the late retirement pension (with the late retirement adjustment) to the following factors. The member may elect to take up to 1/3 of this amount by way of a cash commutation in terms of rule A4.2.0.

AGE AGE 65 12.3152 57 12.5105 64 12.5668 56 12.1783 63 12.8177 55 11.8550 62 13.0674 54 11.5403 61 13.3157 53 11.2339 60 13.5000 52 10.9357 59 13.2022 51 10.6453 58 12.8517 50 10.3627

The above-mentioned factors are applied as follows:

Factors 50 to 59 apply to the early retirement pension without early retirement adjustment.

Factor 60 applies to the normal pension.

Factors 61 to 65 apply to the late retirement pension with enhancement.

B. Members who elect to receive a portion of the pension from the Fund. A member may elect to receive a portion (if any) of the one third commutation (as determined in rule A4.2.0) in cash.

Thereafter he may elect to apply [the whole or] a portion of the balance of the retirement benefit (as determined by the

actuary)[one-third commutation (as determined in rule A4.2.0)] to purchase a pension from an [insurer] insurance

company. Thereafter the member will receive the balance of his pension from the Fund. The purchase of any pension

from an insurance company must comply with any and all the requirements of the Commissioner of Inland Revenue, as set

out in Rule B1.12.3.

Members retiring in terms of rules A3.2.0 (Normal retirement), A3.3.0 (Early retirement

from age 50) and A3.5.0 (Late retirement after age 60 up to 65) may elect to purchase a pension from an insurer in terms of rule B1.12.2 at the date of retirement. Members retiring in terms of A3.4.0 (ill health retirement) may not elect this option. The amount available for the purchase of a pension from an insurer is determined as follows:

A. Members who elect not to receive any pension from the Fund.

Where as a result of the member‟s election no pension will be payable from the Fund, the amount available to purchase a pension will be determined by applying the member‟s early retirement pension (without the early retirement adjustment) or the late retirement pension (with the late retirement adjustment) to the following factors. The member may elect to take up to 1/3 of this amount by way of a cash commutation in

Rule B1.12.0 13 September 2001 50.01.2

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terms of rule A4.2.0.



AGE AGE 65 12.3152 57 12.5105 64 12.5668 56 12.1783 63 12.8177 55 11.8550 62 13.0674 54 11.5403 61 13.3157 53 11.2339 60 13.5000 52 10.9357 59 13.2022 51 10.6453 58 12.8517 50 10.3627

The above-mentioned factors are applied as follows:

Factors 50 to 59 apply to the early retirement pension without early retirement

adjustment. Factor 60 applies to the normal pension. Factors 61 to 65 apply to the late retirement pension with enhancement.

B. Members who elect to receive a portion of the pension from the Fund.

A member may elect to receive a portion (if any) of the one third commutation (as determined in rule A4.2.0) in cash. Thereafter he may elect to apply the whole or a portion of the balance of the one-third commutation (as determined in rule A4.2.0) to purchase a pension from an insurer. Thereafter the member will receive the balance of his pension from the Fund.

46. DEATH BENEFITS TO PENSIONERS The Trustees approved that where the 3 month death benefit is less than R5 919 this amount

will be paid to the dependants or nominees A5.2.2 20 March 2013

The Trustees approved that where the 3 month death benefit is less than R5 610 this amount will be paid to the dependants or nominees

A5.2.2 23 March 2012 13.12.2

The Trustees approved that where the 3 month death benefit is less than R2 700.00 that the sum of R2 700.00 be paid to the dependants or nominees. The increase was in line with increases in pensioner CPI since 1997.

A5.2.2 13 September 2001 56.01.1

47. TYPE OF EDUCATIONAL INSTITUTION Only full time formal study at an educational institution registered with the Department of

Education would be considered by management when awarding student pensions (children of deceased members between the ages of 18 and 25).

A7.2.1 (B) 5 March 2002 4.02.6

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RULING REFER TO


48. BASIS FOR THE CALCULATION OF INTEREST TO BE APPLIED TO MEMBER‟S ACCUMULATED CONTRIBUTIONS, ADDITIONAL VOLUNTARY CONTRIBUTIONS AND DEATH BENEFIT ANNUITIES.

From 1 December 2001, the monthly investment return credited to the member‟s contributions (including AVC‟s) and paid on Death Benefit Annuities for a particular month will be determined as the monthly compound investment return for the 60 months ending at the end of the particular month.

Where the investment return is not available for the relevant 60 months period, the compound monthly return for the particular month will be determined over a longer period not exceeding 62 months. This longer period will cover the latest available 60 months period available plus the period from the end of the latest available 60 months up to the end of the particular month.

The investment return gross of all taxes and fees will be reduced by an allowance for expenses (including Retirement Funds Tax, fund administration and investment expenses) as determined by the trustees. From 1 December 2001, the deduction will be 0,125% per month. The deduction will be reviewed by the Trustees from time to time but at least with every statutory actuarial valuation of the Fund.

5 March 2002 5.02.1

49. CONTINGENCY RESERVES In terms of Rule B1.9.1 (to be revised with effect from 13 September 2001), the Trustees

hereby resolve to establish contingency reserve accounts in respect of the following fund contingencies: AIDS Asset/liability mismatching Impact of the Pensions Second Amendment Act, 2001 Additional spouse benefits in respect of deemed marriages Younger normal retirement ages as per conditions of services MOPF transfer The Trustees hereby resolve that the amounts to be allocated to these contingency reserves are as specified in the 1 March 2001 valuation of the Fund. The Trustees resolve that any contingency reserve accounts are not distributable to members that exit from the Fund. The Trustees will review the balances in the contingency reserve accounts as part of the actuarial valuation of the fund or more frequently as the Trustees decide.

B1.9.1 7 June 2002 26.02.9.1

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50. INTEREST ON ADDITIONAL VOLUNTARY CONTRIBUTION „S (AVC‟s) The Trustees were reminded that at the March 2002 meeting, it was agreed that the interest

rate to be applied to members‟ contributions be applied to additional voluntary contributions (5 years fund performance less fund expenses). However, previously, the rate applied to AVC‟s was a threee year moving average of the Fund‟s investment performance, there was no deduction for Fund expenses. The Trustees accordingly approved the following ruling amendment. Additions were underlined: Basis for the calculation of interest to be applied to the member‟s accumulated contributions, additional voluntary contributions and death benefit annuities. “ From 1 December 2001 (from 1 July 2001 for current in-service members in respect of AVC‟s), the monthly investment return credited to the member‟s contributions (including AVC‟s) and paid on Death Benefit Annuities for a particular month will be determined as the monthly compound investment return for the 60 months ending at the end of the particular month. Where the Investment return is not available for the relevant 60 months period, the compound monthly return for the particular month will be determined over a longer period not exceeding 62 months. This longer period will cover the latest available 60 months period available plus the period from the end of the latest available 60 months up to the end of the particular month. The investment return gross of all taxes and fees will be reduced by an allowance for expenses (including Retirement Funds Tax, fund administration and investment expenses) as determined by the Trustees. From 1 December 2001, the deduction will be 0,125% per month. The deduction will be reviewed by the Trustees from time to time but at least with every statutory actuarial valuation of the Fund. The deduction in respect of the allowance for expenses will not apply to additional voluntary contributions.” The Trustees were reminded that member statements were issued annually for the year ending June each year. The applicable rates to be reported at the September 2002 meeting.

7 June 2002 39.02

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51. DEFINITION OF CHILD (RULE AUDIT A.1) Recommended ruling 31 – Definition of legitimate child:

The following is to be considered by management in the awarding of child pensions: 1. Where the birth/baptismal certificates detailing both parents‟ names are not available, facts management may consider in determining the eligibility of a child for a child‟s pension in terms of the rules, are: Sworn affidavits from the member‟s closest relative Child support records ( as evidenced by a court order, including the proof of payment of

maintenance) Member recognition of children on sworn declarations

5 December 2002 62.02.4

52 Pensioner Increase Policy "Taking into account the requirements of the Pension Funds Act, the Fund aims

to grant a pension increase to existing pensioners and deferred and paid up pensioners on 1 January each year, subject to the affordability thereof by the Fund as determined by the Trustees. The annual increase is targeted, but not guaranteed, to be equal to the year-on-year increase in the "Headline" Consumer Price Index (as published by the South African Department of Statistics) up to the preceding 30 September."

The above policy only becomes effective 1 March 2004.

18 September 2003 56.03.01

53 TRANSFERS: ELEMENT SIX CLOSED PENSION FUND Effective date: 1 December 2003

Pending approval of transfer as above, members so transferring are deemed deferred pensioners.

A separate transfer agreement was entered into with the above fund to compliment this Ruling:

This inter alia records the following: If a benefit-eventuality should arise prior to transfer, benefits will be governed by the

following rules:

(a) Resignation, dismissal retrenchment:

Rules A8.0.0 & A8.4.0

Rule A.9.4.1(a)

10 March 2004 05.04.3.4

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(b) Death No Lumpsum is payable: Rule A8.4.5 Spouse‟/child‟s pensions: Rules A6.1.2 and 7.1.2

(c) Ill-health No eligibility to ill-health benefits If early retirement occurs: Rule A3.3.0

Transfer values to be:-

Equal to member actuarial reserve value, with a minimum of withdrawal benefit Payable in cash

Advance Payments to Element Six to settle benefit :-

Are deemed part of a member transfer value Disinvested from the transfer assets and paid to Element Six.

Transfer assets and investment return

As detailed in the agreement.

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54

Minimum Benefits

The Trustees note that the Financial Services Board accepted the 1 March 2010 valuation report on 28 January 2011. In terms of the Pension Funds Act the assumptions used post retirement for the calculation of the minimum individual reserve for defined benefit members must correspond to those adopted at the last statutory valuation (now 1 March 2010). The FSB understands that the Fund cannot move the most recent valuation basis until the valuation report has been accepted by the FSB. The Trustees therefore resolve to change the basis for the calculation of the minimum individual reserve to the 1 March 2010 valuation with effect from 24 March 2011. In future the change to the basis on which the Minimum Individual Reserve is calculated will be made on the day following the date on which the FSB approves the Fund‟s statutory valuation report”

Def: Minimum Individual Reserve Value [subpara (b) (i) and b(ii)

24 March 2011 06.11.15.2

Refer to Annexure 1 Def: Minimum Individual Reserve Value [subpara (b) (i) and b(ii)

25 June 2008, 37.08

Formula for the calculation of the fair value equivalent of the present value of the accrued deferred pension in subpara b(i) and (b)(ii) of the definition of Minimum Individual Reserve in compliance with Board Notice 35 FORMULA: [Accrued Deferred Pension] x [Age-based factor] x [Value of Pension at Pension Age] Where: (a) Accrual Deferred Pension is equal to: For an active Member before Pension Age Uniform Accrual Rate X Pensionable Service X Final Pensionable Salary. The Uniform Accrual

Rate, Pensionable service and Final Pensionable Salary are as defined in the Rules. With respect to Pensionable Service, note the treatment of Condoned Service in definition of Minimum Individual Reserve subpara [(b)(ii)].

For and active Member after Pension Age (NOTE: This is required to ensure the correct calculation of the MIR for a member on late retirement where a transfer value is paid in terms of new Rule A9.5.0) The Pension to which the member is entitled to in terms of the Rules (COMMENT: The uniform accrual rate is not appropriate for a late retiree.) For Paid-up Pensioner (in terms of Rule A9.5.0 or A5.2.5) and Deferred Pensioners in terms

of Rule A5.2.5)

Def: Minimum Individual Reserve Value [subpara (b) (i) and b(ii)

3 March 2005

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The amount of the member‟s paid up pension as at the date of calculation of the Minimum Individual Reserve

(b) Age-based factor is: 1/(1+40% EY) (Pension Age – Current age at date of calculation)

Where: EY = the earnings yield on the JSE/FTSE All Share Index as published monthly by

the FSB (www.fsb.co.za) The Fund will need to utilise a daily rate supplied by Alexander Forbes.

Pension Age is as defined in the rules.

If (Pension Age – current age at date of calculation) is not an exact number of years,

then the factors should be interpolated. (c) Value of pension at Pension Age This is the value as provided by the actuary of R1 per annum payable in accordance with

the rules of the Fund and using the same assumptions as used in the most recent actuarial valuation. This factor allows for the following:

The post retirement discount rate and allowance for pension increases and fund

expenses is as provided for in the last actuarial valuation. Commutation of 1/3 of the pension based on the Fund‟s fixed commutation factor of

13.5 for each R1 of annual pension.

The balance of the pension includes allowance for an annual pensioner bonus of 5 % of the annual pension and a spouse pension of 66 % of the member‟s pension on death.

90 % of members are assumed to be married at retirement with the male 5 years older

than the females. The factor allows for assumed number and age of children, the assumptions of which are set out in the last actuarial valuation.

Where the Pension Age of a member is not a whole number (such as in the case of the Members with underground service), the factor is interpolated.

For Pension Ages 55 – 60 inclusive: The factors (c) – the value of R1 per annum of pension at Pension Age based on the 1

http://www.fsb.co.za/

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March 2004 valuation are as follows:

Factor (c): Value of Pension or R1 per annum at Pension Age (per 1 March 2004 Valuation Basis) Pension Age Males Females 55 15.15958 15.20669 56 14.99945 15.04323 57 14.83564 14.87438 58 14.66854 14.70018 59 14.49862 14.52069 60 14.32637 14.33601 Note: Pension Age is defined in the Rules

55. Death Benefit Committee 1. The Trustees approved that the committee decide on the awarding of widow and child

pensions where there was Trustee discretion (e.g. common law spouses and illegitimate children etc). Decisions to be ratified by the Board.

2. The Trustees approved that management be permitted to sign the individual trust documents required when setting up trusts in respect of the beneficiaries of deceased members. It was reported that all distributions to trusts were approved by the Death Benefit Sub-Committee and ratified by the Board at the next meeting.

3. The Trustees agreed that on the death of a DB pensioner where there were no dependants i.e. spouse, children and where the member/pensioner had nominated nominees (on the death benefit nomination form), the Death Benefit Sub-Committee could consider paying the death benefit before the expiry of 12 months (section 37c of the Pension Fund Act required that all dependants that were identified within a 12 month period of the member/pensioners death should be considered for an equitable share of the benefit). Currently when dealing with the above-mentioned cases the Committee waited for a period of 12 months after the death of the members and only then paid nominees. It was agreed that the above only applied to DB pensioners where the benefit of the greater of 3 months pension or R3 900 applied.

4. The Requirements set by the Trustees for the recognition of common law spouses for widow‟s benefits in the Fund (Annexure 2)

22 June 2006 34.06.1 March 2007, 15.07.3 26 March 2009, 11.09.2 18 September 2009, 66.09

56. Commutation of Death benefits Notwithstanding that this rule allows, at the election of the beneficiary, for a fully commutable annuity as the Trustees in their discretion may agree, the Trustees have agreed that they will allow as a general rule beneficiary commutation elections as follows::-

C4.1.8 5 December 2006

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To a maximum of 1/3 of the benefits payable in respect of each beneficiary may be

commuted for a lump sum Any balance remaining after commutation shall be paid as a pension (whether ex fund

or ex insurer, as per beneficiary election) Provided always that, at the election of a beneficiary, full commutation will however remain an option as a mode of payment where in deserving cases in the discretion of the Trustees, circumstances or the size of the remaining Pension payable to the beneficiary, so justify.

57. DC Pensioner Increase Policy Taking into account the requirements of the Pension Funds Act, the Fund aims to grant an

increase to life annuitants on 1 July each year subject to the affordability thereof by the life annuity account as determined by the Trustees, in consultation with the Actuary and the Fund‟s asset consultants. The annual increase is targeted, but not guaranteed, to be equal to the year-on-year increase in the "Headline" Consumer Price Index (as published by the South African Department of Statistics for Metropolitan areas) up to the preceding 28 February. The increase for pensioners, whose pension commenced during the 12 months immediately preceding a particular 1 July increase date, will be pro-rata to the number of pension payments payable during this period preceding the 1 July increase date divided by 12."

C3.3.4 March 2007, 05.07.4

58. Deferred Pensioners The Trustees approved that DC deferred pensioners who were still employed could elect to

retire at a later date not exceeding their 65th birthday.

C3.2.5 24 March 2011 14.11

59. Fees payable to non-employee pensioner Trustees The Trustees RESOLVED to increase the daily meeting attendance fee (currently R3 087) paid

to eligible Trustees by 5.5% (Aligned to the January 2013 pension increase) to R 3 257 per meeting. The increase to be effective from the approval date.

B1.3.6 20 March 2013

de beers pension fund 2 of 29 de beers pension fund schedule of rulings ruling refer to rule number...

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