Government

Government invested R18 billion in pension funds in 23 companies and lost 100% of its money

Malcolm Libera

 ·19 Jun 2026

The Public Investment Corporation’s (PIC) Isibaya Fund invested more than R18.2 billion in 23 companies, which ultimately recorded an internal rate of return (IRR) of -100%, meaning the investments lost all their value.

The losses came to light through a parliamentary reply to questions from DA MP Andrew Bateman to the Minister of Finance regarding the PIC’s unlisted investment portfolio.

The PIC is South Africa’s state-owned asset manager and invests money on behalf of public sector clients, including the Government Employees Pension Fund (GEPF), the Unemployment Insurance Fund (UIF) and the Compensation Commissioner Fund.

In total, it manages around R3 trillion in assets across listed equities, property, capital markets, private equity and developmental investments.

The Isibaya Fund serves as the PIC’s specialised vehicle for unlisted developmental investments. 

However, it has attracted significant scrutiny over the years because of investments that have performed poorly and, in some cases, resulted in substantial losses.

The parliamentary response included a list of Isibaya investments showing that 23 companies recorded an IRR of -100%.

These include Berlin Beef, Concor, Daybreak, Educor, Independent Media, LA Crushers, Naturecell, Urban Lifestyle and VBS.

An internal rate of return measures the profitability of an investment by taking into account the timing and size of cash flows. A higher IRR generally indicates a stronger investment performance, while a negative IRR signals losses.

An IRR of -100% represents the worst possible outcome, indicating that investors failed to recover any of their original capital.

This result can occur if a business collapses without returning value to shareholders, a project is abandoned before generating revenue, or assets become worthless with no opportunity to recover losses.

Although these 23 investments recorded complete losses, the overall Isibaya portfolio, dating back to 1 March 2006, has an IRR of 4.25%.

However, that figure remains well below long-term market returns and has fuelled criticism of the fund’s investment decisions.

DA launches an investigation into the investments

Much of that criticism stems from findings by the 2020 Mpati Commission, which investigated governance at the PIC.

The commission concluded that the institution had been affected by political interference, weak oversight and governance failures, with some of the most serious concerns centred on the Isibaya Fund’s unlisted investments.

According to the commission, weaknesses in governance and internal controls left the fund vulnerable to poor decision-making and inadequate due diligence, contributing to investments that lost most or all of their value.

The disclosure of the latest figures has prompted renewed calls for accountability. In a statement, the Democratic Alliance (DA) said it would launch a full investigation into the Isibaya Fund. 

“The Public Investment Corporation (PIC) has lost billions set aside for government pensions and other public purposes through reckless investments in its ‘Isibaya Fund’—investments which have lost all of their value in some cases,” the DA said. 

The party highlighted the Daybreak investment as one example, and said it is now worth a small fraction of the PIC’s investment of approximately R2 billion.

The DA stressed the importance of the funds under the PIC’s management, and argued that “every rand lost to negligence or corruption is money that should be securing the retirement of teachers, nurses and police officers.”

It said it had submitted detailed parliamentary questions seeking information about why the investments were approved and the due diligence performed before funding was provided.

The party also said it would find out who authorised the transactions, whether conflicts of interest were disclosed, whether politically connected individuals benefited, and whether any misconduct had been referred to law enforcement agencies.

“The Minister has already confirmed the losses on each investment, but what remains to be investigated is why these deals were approved, who benefited, and who should be held to account,” the DA said.

The party also argued that the Mpati Commission had already exposed deep governance failures at the PIC, but that accountability had been limited.

It added that it would continue pushing for amendments to the PIC Act aimed at reducing political influence over the institution’s governance and the appointment of its board and chairperson.

PIC’s worst Isibaya Fund investments