DA wants probe on Transnet pension

2012-07-24 14:55

The Democratic Alliance has asked Public Protector Thuli Madonsela to investigate two Transnet pension funds, MP Natasha Michael has said.

“More than 70?000 pensioners belonging to the Transnet Pension Fund and the Transnet Second Defined Benefit Pension Fund are facing destitution as the paltry increases in their benefits of 2% per annum fail to keep up with the rising cost of living,” she said.

“Inflation is currently 5.7%.”

The formal request was submitted today.

Michael said that as result of the poor management of the funds, Transnet pensioners who retired in 1990 on R1?400 a month currently received only R3?000 a month.

“Pensioners at other state-owned enterprises, such as Eskom, who retired with a similar pension in 1990 now receive approximately R8?000 per month,” she said.

Despite a 2010 instruction by Parliament to Transnet and the National Treasury to invest R1.9 billion into the ailing pension funds, the Treasury had not yet recapitalised the fund, citing the fact that the payment was not budgeted and was unaffordable.

“Transnet boasted an increase in profit due to rocketing freight volumes and operational efficiencies despite escalating operating costs at the end of the financial year in March,” said Michael.

She said earnings before interest, depreciation, taxation and amortisation – the company’s main measure of profitability – shot up 19.8% to R18.9 billion.

“If Treasury is not able to inject funds into the Transnet funds, it may be time for Transnet to identify ways to restore the fund themselves.”

She said Transnet was a state-owned entity and if it was not performing its obligations to pensioners, the Office of the Public Protector should investigate and make recommendations on rectifying the problems in the management and financing of Transnet pensions.

“I will continue fighting to ensure that Transnet pensioners receive increases that will enable them to maintain an acceptable standard of living in their old age,” Michael said.

Join the conversation!

24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions.

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.