Savings were disturbingly low in South Africa and, in 2013, the country’s national gross savings rate, as a percentage of gross domestic product, stood at 13.5%, down from 14.2% in 2012, Deputy Finance Minister Mcebisi Hubert Jonas said at the launch of the Annual National Savings Awareness Campaign on Thursday.

He stated that households contributed a meagre 1.7% to the gross savings rate.

The deputy Minister noted that saving is important not only for households, but also for government and companies.

“The global financial crisis of 2008 and its aftermath showed how vulnerable governments could be when they excessively spend – especially for consumption – and use excessive borrowing for such spending,” he commented, adding that the South African government’s thriftiness in the years leading up to the financial crisis had enabled it to stabilise the economy and avoid a deeper economic recession.

Meanwhile, he also pointed out that, up to May this year, R9.1-billion had been invested in RSA Retail Savings Bonds, an initiative of National Treasury.

Jonas pointed out that, owing to public demand, a Top Up Bond would be introduced towards the end of this year.

“Potential investors would be able to invest from as little as R500 and top it up from as little as R100 at any time. This should attract younger and smaller savers. Informal groups, such as stokvels, clubs and other community structures will also be allowed to invest in the Top Up Bond,” he said.

The Annual National Savings Awareness Campaign is an initiative of the South African Savings Institute.