The Government Employees Pension Fund (GEPF) adheres to strict rules dictating the disbursement of benefits to its members, pensioners, and beneficiaries. These rules are enshrined in the Government Employees Pension (GEP) Law or negotiated Regulations via the Public Service Coordinating Bargaining Council (PSCBC).
Defined Benefit Fund Guarantee by GEPF
GEPF operates as a defined benefit fund, guaranteeing a specific benefit structure for its members. This differs from private sector pension funds, as benefits are calculated using specified formulas and exit factors, considering service years and the final average salary.
Implications of GEPF Resignation vs. Retirement
Opting for resignation over retirement from government service, especially for those with service exceeding ten years, results in significant losses across various benefits:
1. Monthly Pension Loss
- Resignation leads to a one-time lump sum payment (gratuity), foregoing the option of receiving a lifelong monthly pension (annuity).
- The spouse or life partner loses the entitlement to a percentage of the monthly pension upon the member’s demise.
2. Medical Aid Subsidy Forfeiture
- Resignation eliminates state contributions towards the member’s medical aid.
- The subsidy towards monthly medical aid membership, applicable for those with 15 or more years of service, is forfeited upon resignation.
3. Funeral Benefit Ineligibility
- GEPF’s funeral benefit, designed to assist with funeral costs, is not accessible upon resignation.
- The benefit, payable on the death of the member, spouse, life partner, or eligible child, ceases to apply in the event of resignation.
Careful Consideration Before Resignation
Before choosing resignation over retirement, GEPF members are urged to thoroughly assess their options and understand the potential benefits forfeited. Whether an active member or pensioner, GEPF assures that the benefits received will adhere to the stipulations of the law and regulations, providing a safeguard for members’ financial security.