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Comment on the Master’s Office by the Fiduciary Institute of Southern Africa (FISA)

21 October 2021 Fiduciary Institute of Southern Africa (FISA)
Louis van Vuren, CEO of the Fiduciary Institute of Southern Africa (FISA)

Louis van Vuren, CEO of the Fiduciary Institute of Southern Africa (FISA)

The public should be aware that there is an unprecedented backlog at the Master’s Offices countrywide. There are however some recent positive developments.

The Master of the High Court has been hard hit over the past 18 months by COVID closures and, more recently on 5 September 2021, a major cyber attack. These two developments combined have caused an almost total breakdown in services by the 15 Master’s Offices around the country.

There has been a recent positive development however in that the Master’s Office ICMS system has been restored, albeit on a sporadic basis, and has been accessed by some fiduciary practitioners.

It appears that Master’s Office officials are able to receive external messages, but it is currently uncertain whether all external messages are received. Furthermore, the offices can unfortunately not currently respond to queries, but might be in a position to respond telephonically, if the query is not reliant on the system.

Louis van Vuren, CEO of the Fiduciary Institute of Southern Africa (FISA) said that the public should be aware that processes which often take some time to be completed will be delayed yet further.

For example, the Master’s Office fulfils a crucial role in providing inter alia Letters of Executorship to executors of deceased estates, Letters of Authority to authorised trustees, and the approval of liquidation and distribution accounts in deceased estates. Banks use the Master’s Office portal to verify Letters of Executorship before they are willing to take instructions from executors regarding the bank account(s) of the deceased. This is a crucial step to enable the executor to make interim maintenance payments to a surviving spouse and/or children of the deceased. All these functions have essentially been on hold since 5 September.

Mr van Vuren said: “Trusts have also been badly affected. New or replacement trustees are not authorised which, if the trust deed requires a certain minimum number of trustees, means that the investment portfolios of trusts cannot be rebalanced and can be impacted negatively by market movements. In addition, testamentary trusts cannot be registered, leaving minor children without maintenance while new charitable trusts can also not be registered. The impact on society and the economy is therefore significant.”

He said: We would like the public to know that the problems are beyond FISA members’ remit, but we are willing to assist the Master’s Offices around the country as much as we can within the existing constraints.

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QUESTION

The second draft amendments to Regulation 28 will allow retirement funds to allocate up to 45% of their assets to SA infrastructure, with a further 10% for rest of Africa; but the equity & offshore caps remain unchanged. What are your thoughts on the proposal?

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Infrastructure? You mean cash returns with higher risk!?!
Infrastructure cap is way too high
Offshore limit still needs to be raised
Who cares… Reg 28 does not apply to discretionary savings
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