GNU politicians stealing workers’ pension money – EFF

Alameen Templeton

Corrupt local politicians and officials in Government of National Unity municipalities are stealing pension fund contributions that they’ve deducted from workers’ salaries, the EFF is warning Wednesday.

The corruption involving more than a billion rands of missing pension money would ignite a financial crisis when the “Two-Pot” pension system allowing-off withdrawals from pension funds kicked in, the EFF said.

It pointed to a recent Financial Sector Conduct Authority (FSCA) report, that found 172 municipalities owe more than R1 Billion in pension fund contributions.

“The report paints a worrying picture, wherein South African local government municipalities have been deducting money from their employees, and not paying it towards the pensions of workers.

“This blatantly reckless behaviour, is a ticking time bomb that places municipal workers at financial risk,” the EFF said.

The biggest offending municipalities were all in the GNU camp – George and Mossel Bay in the Western Cape have not paid their pension contributions in over 200-months. Both are governed by the Democratic Alliance (DA), the EFF noted.

“Municipalities such as the Umsunduzi Local Municipality which is controlled by the African National Congress (ANC) and the Nquthu Local Municipality which is controlled by the Inkatha Freedom Party (IFP) owe municipal pension funds for over 100-months respectively.

“It must be noted that these four local municipalities, which are jeopardising the financial security of workers, are governed by the ruling so-called ‘Government of National Unity’.

“Therefore, governance in South Africa is clearly plagued by what can be characterised as malicious non-compliance in order to create crisis, and provide private sector intervention as the only viable solution.

It warned a municipal funding crisis was looming, predicting local politicians would first try hide the funding hole by turning to emergency loans which would leave the local government sector hopelessly ensnared in unaffordable bank debt “which will be underwritten by the State and further enrich the funders of the DA and ANC respectively”.

It warned that, when “two-pot” system under the Revenue Laws Amendment Bill- which allows members of pension funds to withdraw savings without retiring – kicked in, a liquidity crisis would unfold.

“Put simply, security guards and municipal workers will attempt to withdraw money from pension funds using the two-pot system, whereas their employers have not been making the required contributions. As a result, there is a dangerous crisis pending that will affect the working class, because there is no money in their pension funds,” the EFF warned.

It said its representatives in local municipalities would hold municipal managers to account. Municipal managers would be required to “outline whether they have been making the required monthly contributions to the municipal pension funds of workers. All municipalities must account how much they individually owe the municipal pension funds and present repayment plans if they are in arrears.”