A mattress or the PIC – who invests better?  

The Public Investment Corporation (PIC) is the steward of more than R3.5-trillion worth of mostly government employees’ pension fund assets.

Despite its stature, the state’s principal investor has faced scandal after scandal, especially regarding its unlisted investments, which were worth a not-inconsiderable R162bn as of October 2025. These are huge pools of money, and the PIC’s responsibility towards its principal constituents – state employees – is considerable.

Maybe it’s unfair to compare the government-run PIC with any private sector asset manager, given its broader mandate. Perhaps a more just comparison is to consider whether the billions pumped into unlisted investments would have been better thrown under a mattress (the couch is already full) instead of an assortment of cadre companies and scams.

Consider the three criteria on which the PIC should be judged: investment returns, social impact and credibility.

Category 1: investment returns

Thanks to a recently published parliamentary question, we know that the internal rate of return for the PIC’s unlisted equities (the “Isibaya” portfolio, which excludes its property investments) has been all of 1.43% per year over the past decade.

For context, average annual inflation during that period was 5%. Still, historically, mattresses have had lower returns, unless it’s a tokenised mattress on a blockchain. So, this round goes to the PIC.

Category 2: social impact

The PIC’s unlisted investment decisions are supposed to consider not only returns but also social change and transformation.

If by transformation the PIC means it transforms functioning businesses into bankrupt ones, then it’s done a great job with the R19.7bn dumped into 26 investments that are now valued at precisely zero.

The PIC is quick to point out that many of its problematic investments stem from the state capture era and that its post-2022 performance reflects reforms. But its rhetoric doesn’t match the record.

Since 2022, the PIC has performed better in the sense that it only had to write off R41.5m last year after a decision to fund Enable Capital – which turned out to be an alleged scam. It also made a R30m investment into a company called Bambili, which it now values at little more than R3m (that’s not the direction you’re supposed to 10x).

Nor are the problematic legacy assets a thing of the past. Take the Daybreak poultry farm, which the PIC bought for R1.2bn in 2015 and which has guzzled up cash ever since, including R250m last year alone. This is the same operation, you’ll recall, that left 350,000 chickens to starve last year – in between PIC bailouts.

These investments linger and fester like bedsores. Contrast this with the social impact of investing your money under a mattress: no job loss, no scandals, no fuelling of cadre networks. The implications of the PIC’s investment decisions will keep you up at night whereas a mattress will help you sleep.

Category 3: credibility

The PIC is supposed to be regaining credibility following the state capture period and a commission of inquiry that culminated in the publication of the Mpati report in 2020.

This report includes numerous recommendations that the PIC claims to have “fully implemented”, but this claim is like a product ordered on Temu – under scrutiny, it frequently falls apart.

The PIC makes use of what psychologists call the illusory truth effect: you repeat a lie – in this case that recommendations have been “fully implemented” – again and again until people believe it.

It is not solely the asset manager’s fault; the law needs to change. The Mpati report was clear: the deputy minister of finance should not be the PIC chair. Yet, Dr David Masondo remains the chair because the PIC Act hasn’t been amended since publication of the report.

Perhaps, if the finance ministry can’t bring an amendment bill, it’s time for the legislature to step up and legislate.

And the winner is …

The mattress. It may give slightly lower returns, but thanks to its edge in social impact and investment credibility the mattress is the winner. Yet the loser isn’t actually the PIC, it’s the South African people.

Mark Burke is the DA’s spokesperson for finance and an MP.

ALSO READ:

• Returns, and redemption, for the GEPF
• Daybreak: A stain on South African business
• What South Africa’s largest fund is buying now

_{Top image: Rawpixel/Currency collage.}