How Does The GEPF Pay For Divorce?
How Does The GEPF Pay For Divorce?
The Government Employees Pension Fund (GEPF) accepts all types of marriages, including customary ones, but it does not decide if these marriages are legal. If a couple gets divorced, the GEPF will handle claims related to a member’s pension benefits once it receives a divorce decree that says to pay the ex-spouse. The courts are the ones that determine if spouses can make claims against each other.
After a divorce is finalized, the spouse who is not a member must send the divorce decree to the GEPF. When the GEPF gets the decree showing how the pension should be divided, it must follow the court’s order and pay the former spouse according to what was agreed upon or ordered.
GEPF Divorce Payments
Before the GEPF can process a divorce order for its records and pay part of the pension interest, the order must comply with the Divorce Act 70 of 1979, specifically section 7(8). It must include the following requirements: identify the pension fund, direct the Fund to record an endorsement on its records and instruct the Fund to pay a portion of the pension interest to the non-member spouse.
If the divorce order does not state that the benefit is calculated based on the duration of the marriage, the divorce interest will be calculated based on the member’s entire pensionable service up to the divorce date. This applies if the member has been divorced more than once, if the divorce date is before May 1, 1997, or if the member’s exit date is before the divorce date.
GEPF Divorce Benefit
The Government Employees Pension Fund (GEPF) will no longer treat members as if they have a debt when handling divorce orders. Instead, the recent law amendment allows for a reduction in the pensionable service years of GEPF members to reflect the amount paid to a former spouse according to the divorce order. This means that instead of creating a debt, the GEPF will adjust the member’s pensionable service years after paying a divorce settlement.
As a result, the benefit a member receives when they leave the GEPF will be lower because their years of service will be reduced to account for the pension amount paid to the ex-spouse during the divorce. However, members will still receive their benefits after this adjustment, meaning their benefit will be calculated based on the new, lower service years.
Members who retire with more than ten years of pensionable service will still be entitled to a lump sum and a monthly pension when they exit the fund, but these will be based on the reduced value in line with their adjusted years of service.
What Will Happen When a Member Divorces And A Spouse Claims Against Their Pension?
Under the new service reduction approach, a member’s pensionable service will be lowered to reflect the amount paid to an ex-spouse according to the divorce order. The amount paid will be converted into pensionable service years, which will then reduce the member’s total years of service.
When the member leaves the Fund, their benefits will be calculated based on these reduced pensionable service years. However, the Fund will still recognize the member’s actual years of service (before the reduction) for benefits, meaning they will still be entitled to a gratuity and annuity based on their full-service years, but those will be calculated using the reduced service.
The GEPF is currently working on the rules for implementing this change. Once finalized, the new service reduction rules will apply to all divorce orders where the GEPF is ordered to pay part of the pension to an ex-spouse.
GEPF Contact Details
Toll-free number: 08 00 117 669
Fax: 012 326 2507
enquiries@gepf.co.za
Postal Address
GEPF Private Bag X63,
Pretoria,
0001
Visit the official website of GEPF for more information. I hope the provided information is helpful, share your thoughts below in the comment section.