GTC Q2 2024

Roger Schärges Senor Onboarding Consultant     _______________________________________________________________________________________________________ NHI – From a (sort of) layman’s perspective I remember the first time I heard about the proposed National Health Insurance (NHI).  It was 23 years ago and I had just joined the financial services industry.  At that time in 2001, the first proposals for NHI had been tabled, and Thabo Mbeki was president.  HIV was being managed by doses of garlic and sweet potatoes, and South Africa was entering a property boom that would lead us into a period of prosperity unprecedented in the South African investment environment.  Little did we know at this time what the next decade would bring us…   As regards the experts in the medical aid and financial services industries, who, advising on the proposed NHI, informed us (in the early 2000’s) that there were still... Read More

Regardless as to how jaded we might be, the subject of NHI is of huge importance and financial consequence to us and attracts very strong and emotional view points.  In this Trendline we try give a balanced perspective. Healthcare Consulting – NHI Q2 2024 The NHI – From a (sort of) layman’s perspective

Gary Mockler Group Chief Executive Officer _______________________________________________________________________________________________________ Time certainly passes by fast when managing other people’s assets.  It would seem (though we’re nothing by interested and affected bystanders) though that in the realms of politics, time passes by even quicker. The past quarter and the beginning of this next quarter have proven difficult to report on.  Not so much the performance and trending of the markets, but the to-and-fro dynamics of the macro political environment – which of course is a major influencer on the direction and trending of that which is most important – the markets.  Verifying a sustained South African political trend has proven difficult.  It doesn’t seem that you need time and gradual momentum to build an opposition party – ask uMkhonto weSizwe.  It’s also become evident that years of building one can be undone in a... Read More

Zee Gumede Healthcare Consultant   _______________________________________________________________________________________________________ Constitutional rights and the intention of NHI On 15 May 2024, President Cyril Ramaphosa signed the NHI Bill into law.  On 16 May 2024, the NHI Act was gazetted, though no effective dates were stipulated. According to the South African Constitution in Section 27, everyone has the right to healthcare services including reproductive healthcare services, and no one may be refused emergency medical treatment.   The intention of the NHI is to achieve universal health coverage for all South Africans, specifically referencing financial health coverage.  The sixth government administration since 1994 promulgated the NHI, stating that they believed that extending health coverage for all South Africans would improve access to care, quality of care and continuity of care.  They also believed that NHI reforms will contribute to the health system having a co-ordinated and... Read More

Dave Johnson Independent Trustee       _______________________________________________________________________________________________________ Initial withdrawal focus: Potential disillusionment? The introduction of the ‘Two-pot’ System has certainly generated much interest, but perhaps some of  the most important  discussion points have been missed? The main focus of discussion and debate has been on the initial seeding capital withdrawal of up to R30 000 per member from 1 September 2024.  The fact that for most people the actual payout will be less than R30 000 due to the tax deducted, administration fees, or the 10% cap may lead to some unhappiness, and there will surely be many disillusioned retirement fund members not meeting their short term financial objectives that they were hoping to accomplish through Two-pot? For many, Two-pot will provide some moderate relief from prevailing financial plight, and of course the proceeds of these premature withdrawals will... Read More

_______________________________________________________________________________________________________ How does a South African retirement fund work, and more importantly, will it work for me? The introduction of Two-pot prompts some reflection and perhaps introspection as to how relevant an approved retirement fund is in an investors’ financial planning armoury. The sacrosanct nature of approved retirement funds Approved retirement funds in South Africa include pension, provident, and retirement annuity funds.  ‘Approved’ because there are tax deductions permitted, (mostly) favourable tax consequences on the investments made, and some complex tax consequences on the proceeds.  All of this is within the auspicious of SARS, and in terms of promulgated regulations.  Retirement funds have the financial oversight and regulation of FSCA and other government bodies.   Up to 27,5 % of a member’s taxable income can be invested into a retirement fund without incurring tax, with a ceiling of R350 000... Read More

  David Seligman Fund Manager       _______________________________________________________________________________________________________ Semigration: Would you bet the house on it? Perhaps a uniquely South African word, semigration has been both a noun and a verb in South Africa for the past ten years or more. The already established trend whereby retirees move from the economic hub in the centre of the country to coastal locations, favouring lifestyle over economic activity, has gained momentum and intensity with more economically active South Africans (actively supported by the work-from-home permissions of the Covid-19 years) choosing to move from one urban area to another. Nowhere is this more clear that the move of economically active South Africans from various locations to the Western Cape.  This migratory trend is also in sharp contrast to the historical trend of rural populations moving into South Africa’s economic hub. The economic... Read More

In-depth market commentary – Ready, set… GNU Over the quarter the world continued to grapple with lofty global US Tech valuations, stubborn inflation, incessant conflict in the Middle East, and a somewhat deteriorating geo-political outlook.  At home, we took to the polls to cast our ballot for a better South Africa.  Resulting from this election was an improved functioning cabinet that emerged from the ANC’s clunky attempt to remain in the driving seat of South Africa’s government, albeit with nine passenger parties now. Over the quarter: Local equities ended the quarter up +8.2%, well ahead of Developed Market Equity and Emerging Market Equity indices.  The month of June alone reported a +4.2% gain as investor sentiment turned positive on the back of the South African election results. While the Resources and Industrials sectors drove much of the positive equity market... Read More