The National Treasury is offering government employees aged 55 to 63 the chance for early retirement without pension penalties, along with financial incentives designed to ease their transition out of the workforce.
Employees can access these benefits through the Incentivised Early Retirement Programme (ERP) and the Public Service Voluntary Exit Programme (VEP).
These initiatives are part of a broader strategy to manage the public wage bill while refreshing the workforce without resorting to retrenchments.
The offer applies to employees in departments and sectors governed by the Public Service Act, including teachers, members of the South African Police Service, intelligence officers, and defence personnel.
The applications opened on 15 October and will close on 30 November 2025.
INCENTIVISED EARLY RETIREMENT PROGRAMME EXPLAINED
The Incentivised Early Retirement Programme targets public servants aged 55 to 59 who have at least ten years of pensionable service.
Eligible employees can retire without pension penalties under Section 16(6) of the Public Service Act and receive a financial incentive.
The incentive is calculated as:
- Two weeks of basic salary per year of service for the first twenty years
- One week of basic salary per completed year after that
The final decision to approve applications rests with the executive authority in each department, who may consider operational requirements.
Employees with fewer than ten years of pensionable service. Contract or temporary staff, and most casual workers, do not qualify.
However, Directors-General and department heads may also apply under this programme.
PUBLIC SERVICE VOLUNTARY EXIT PROGRAMME EXPLAINED
The Public Service Voluntary Exit Programme targets employees aged 60 to 63 who wish to leave before normal retirement age without losing pension value.
Like the ERP, applicants must:
- Be permanently employed under the relevant legislation
- Have at least ten years of pensionable service
The Cabinet approved a financial incentive for this group, calculated at:
- Two weeks of basic salary per year for the first ten years of service
- One week of salary per additional year thereafter
National Treasury will pay pension benefits according to the Government Employees Pension Fund rules, with no penalties applied.
Departments will fund these exits through National Treasury, which has set clear application guidelines and conditions.
However, executive authorities decide whether to approve or decline applications based on operational needs.
LIMITED OPPORTUNITY
Employees considering these programmes are advised to:
- Check their pension estimates early
- Clarify financial incentives with Human Resources
- Submit applications before the deadline
Additionally, the offer will not automatically roll over into the next financial year unless extended by the government.
