Industry must follow Wierzycka's lead and oppose prescribed assets - IRR
27 February 2024
The IRR welcomes the strong stance taken by Sygnia Ltd CEO and co-founder Magda Wierzycka against the ANC's reheated attempt to raid the pensions and savings of South Africans to pay for the failures of government.
From 2019 to 2020, the IRR led the charge against the ANC's prescribed assets policy – one now reintroduced in the party's 2024 election manifesto.
Flagging the threat of prescribed assets early in 2019, the IRR immediately launched a campaign to halt the policy. The form of this campaign was straightforward: we put a simple question to South Africa's largest financial and asset management companies: were they willing to hand to the government money their clients had entrusted to them? Whatever the rationalisations of some in the industry, this is, after all, what the result of a prescribed assets policy would be.
Says Hermann Pretorius, IRR head of strategic communications: "We came in for a lot of flak, with news media and the financial sector accusing us of stirring panic. However, as we doubled down on our efforts to stop the policy, sector insiders, contacting us covertly, alerted the IRR to the fact that negotiations between sector leaders and the Presidency to implement prescribed assets had been under way for months. We upped the pressure on the industry by prompting the public to join us through a letter-writing campaign in putting similar questions to their own financial services providers. Soon, the pressure began to tell.
"We were informed of management memos warning staff that no-one was to engage with the IRR on prescribed assets. This was yet more evidence that we were on the trail of uncovering and frustrating a stitched-up deal between the government and industry to sell out their clients."
In September 2020, Magda Wierzycka accused the IRR of blackmail when we engaged her about the position of her company, Sygnia Ltd, on the issue of prescribed assets. Following a letter in which the IRR stated that the content of our correspondence with her would be made public on social media, Wierzycka made her sensational and untrue blackmail claim.
This public confrontation ensured national attention was focused on prescribed assets and the IRR's fight against it.
The IRR's campaign of 2019-2020 was highly effective in not only halting the looting of pensions and savings for years, but ensuring a fundamental change of attitude within the financial industry towards selling out clients by collaborating with the government on prescribed assets.
Adds Pretorius: "Whatever the nature of our past engagements, I applaud Ms. Wierzycka for her bold stance in opposition to this microwaved attempt by the ANC to loot pensions and savings. We are proud to have played a vital role in exposing efforts in 2019 and 2020 by the industry to naively go along with such looting, and we are pleased to see the results of our campaign in changed attitudes and unapologetic industry opposition to prescribed assets.
"In stopping pro-poverty forces and policies, one inevitably stirs the pot. That's part of the job South Africans need us at the IRR to do. But in building a pro-growth coalition and arming the pro-growth forces in our country, there can be no question of the stakes. Having been on the receiving end of heated criticism for taking a stand against prescribed assets as a pro-poverty, anti-growth policy, I must acknowledge and welcome the bravery of Ms. Wierzycka in joining the IRR's fight against this toxic and disastrous policy. We encourage her peers to follow her lead and help the IRR once again to thwart attempts by government to get their hands on assets people have worked hard to earn."
Pretorius concludes: "The South African state is in fiscal trouble. However, the solution lies in slashing waste in public procurement and cutting taxes to unleash economic growth, not in looting private assets."
Issued by the IRR, 27 February 2024
