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Sunday, 21 June 2020

Gov't could manage takaful, karama pension via dedicated investment fund

Gov't could manage takaful, karama pension assets via dedicated investment fund: Prime Minister Moustafa Madbouly discussed a proposal by the Social Solidarity Ministry to turn the takaful and karama pensions into a fund and invest pensioners’ savings, according to a cabinet statement. The proposal also includes granting beneficiaries cash allocations through integrating the program into the new social security framework.

What is the ministry proposing, exactly? The Social Solidarity Ministry wants to set up an independent investment fund that would invest pensions in the capital markets to maximize returns. Ministry spokesperson Mohamed El Okaby told Enterprise that this is one of several proposals to make the programs — which currently pay out to around 3.5 mn people — more fiscally sustainable. The government has increased budget allocations for pensions to EGP 170 bn and EGP 19 bn to social security and takaful and karama in the FY 2020-2021 budget.

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