Municipality must pay

2019-04-24 06:00
Muvhango Lukhaimane Photo: Supplied

Muvhango Lukhaimane Photo: Supplied

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The cash-strapped Kopanong Local Municipality in the Xhariep region in the Free State owes employees over R58 million in unpaid pension funds.

Despite efforts taken to pay money into the workers’ pension fund – the South African Local Authorities Pension Fund (SALAPF) – the ANC-led municipality has dismally failed to pay the contributions of several employees since March 2013.

The municipality’s chaotic state came to light during an investigation by the Office of the Pension Funds Adjudicator after several employees lodged complaints about the municipality’s failure to pay their third-party contributions.

These include payments to the pension fund, medical aid and insu­rance premiums. resulting in policies lapse due to non-payment by the municipality.

  • The investigation involved the SALAPF, Fairsure Administration (Pty) Ltd (second respondent) and the Kopanong Municipality (third respondent).

Muvhango Lukhaimane, the pension funds adjudicator, said the Kopanong Municipality had contravened the Pension Funds Act by failing to pay all contributions in respect of the complainants.

According to the complainants (employees), the municipality deduc­ted pension fund contributions from their salaries, but failed to pay over the money to the SALAPF.

“Other than sending letters to the municipality, this tribunal is not aware of any legal action taken by the fund to remedy the situation since it became aware of the default by the municipality in 2012,” said Lukhaimane.

Findings revealed that the municipality was in arrears of an estimated amount of R58 347 794,69 in unpaid pension fund contributions.

Lukhaimane stated that the Kopanong Municipality was afforded the opportunity to respond to the complaint.

“However, it failed to file a response.”

She said the municipality further failed to provide the name of the person who could be held personally liable for the non-payment of contributions and have his or assets attached - if necessary, to recover the workers’ pension fund.

The Kopanong Municipality has been ordered to pay employees their contributions with interest, while the SALAPF was ordered to provide the complainants (workers) with a breakdown of their contributions and latest benefit statements.

Since the beginning of the year, dissatisfied employees have embarked on a strike, demanding from the ANC-led municipality what is due to them.

This trouble-ridden municipality governs Bethulie, Edenburg, Fauresmith, Gariep Dam, Jagersfontein, Philippolis, Reddersburg, Springfontein, Trompsburg and Waterkloof.


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