PIC says it hasn’t been briefed on plan to use pensions to bail out Eskom

The Public Investment Corporation (PIC) is concerned about reports that it will provide funding to bail-out Eskom, as it still has not been approached on the matter.

This comes after the Congress of South African Trade Unions (Cosatu), the nation’s biggest labour organisation, reportedly reached an agreement with business on a plan to save Eskom.

Key to this plan is the use of civil servant pensions and a state-run unemployment fund to cut Eskom’s debt by about R254 billion.

The PIC manages in excess of R2 trillion on behalf of clients that include the Government Employees Pension Fund (GEPF), Unemployment Insurance Fund (UIF), Compensation Commissioners’ Fund (CC) and several others.

“Every decision the PIC takes is based on the merits of each investment proposal and aims to generate risk-adjusted financial and social returns for our clients,” the PIC said in a statement on Thursday (13 February).

“Should the PIC receive a proposal to further invest in Eskom, the PIC will follow its governance process as outlined in the investment mandates to arrive at a decision.”

The PIC added that it ‘is well aware of the risk that Eskom poses to the South African economy and to the funds invested on behalf of its clients’.

“The PIC is ready and keen to engage with various stakeholders to find a suitable and sustainable solution for the systemic risk posed by Eskom.

“Such a solution must be in line with prudent management of client assets. The PIC is obligated to always act in the best interests of its clients, whilst giving due regard to the national interest,” it said.

Read: South African union takes legal step to stop Eskom pension plan

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PIC says it hasn’t been briefed on plan to use pensions to bail out Eskom