Another chapter finishes in Venda Pension Fund saga

In the latest chapter of the seemingly endless story of the Venda Pension Fund, the Gauteng Division of the High Court ruled in favour of the Public Protector. The court ruled on 31 August against the Minister of Finance’s efforts to have the Public Protector’s reports set aside.

In 2011, the former Public Protector (PP), Adv Thuli Madonsela, investigated complaints by pensioners that the National Treasury and the Government Employees Pension Fund (GPEF) had acted improperly when privatising the Venda Pension Fund. Madonsela found, among other things, that the complainants had suffered prejudice as they were influenced to privatise their pension benefits but were not properly informed about the consequences of the privatisation.

Following Madonsela’s finding, a task team was formed to investigate the claims and verify the information of the claimants.

The issue gathered dust on the desks of various officials for years. The matter eventually ended up on the desk of the new Public Protector, Advocate Busisiwe Mkhwebane. In her special report, she directed Lungisa Fuzile, the director general of finance, to submit an action plan on remedial action to be taken.

Mkhwebane’s report also tried to address fears expressed that payment of compensation in this matter would open a floodgate of claims by former state employees. “The remedial action [in the 2011 report] was designed to address maladministration that is demonstrably unfair and unreasonable in the specific set of circumstances of this matter,” it said.

The consolidated list of complainants estimated the number at approximately 7 000, many of whom are “penniless, relying on old-age grants, while a number had already passed on”.

In December 2017, Treasury said it was working together with the Government Pensions Administration Agency (GPAA) to address the remedial action. The GPAA embarked on a process of reviewing available data, saying that this was necessary to ensure that the project would be implemented accurately. Treasury also enlisted the services of an actuary in an attempt to establish a reliable database of potential beneficiaries of the proposed remedial action.

The hopes of thousands of pensioners to finally receive some sort of compensation were, however, frustrated when the Minister of Finance indicated in 2019 that his office would contest the PP’s findings.

The case that served before judge Fayeeza Kathree-Setiloane was very technical in nature. The Minister of Finance asked on 11 March 2019 that the PP’s report of 2012, as well as the 2016 Special Report, be reviewed and set aside. The PP, assisted by Boqwana Burns Inc as attorneys on record, argued against this and filed a rule 6(5)(d)(iii) notice. Such a notice means that the defendant intends to raise issues of law, arguing that the application should be disallowed for non-adherence to legal procedures.

Five points of law were raised, among these pre-emption, non-joinder of the National Assembly, and the fact that the 2016 special report prescribed no remedial action, but merely sought to facilitate the implementation of the 2012 Report.

The Minister of Finance responded by filing a rule 23(1) exception, saying that the filing of the notice did not constitute a defence. The PP opted not to file an answering affidavit, simply relying on the notice.

Judge Kathree-Setiloane did not agree with the Minister’s legal team and ruled against the application. “If the respondent relies exclusively on the notice in terms of rule 6(5)(d)(iii), as the Public Protector does in this case, the allegations in the founding affidavit must be taken as established facts by the court,” she said. She said that, once the notice was served on the minister, the matter was ready to be set down for hearing before a review court, “for it to make a determination on the points of law raised in the notice”.

At the time of our going to press, no certainty exists whether the case will now return to court for a review hearing. The Venda Concerned Pensioners Group (VCPG) has joined the PP in opposing the application. The VCPG is represented by Erwee Attorneys from Musina. The VCPG represents a claimed 16 000 former members of the Venda Pension Fund.

While the legal battles continue, thousands of the affected pensioners are living in abject poverty, relying on social grants to survive. Their hopes are still pinned on some sort of payment from the former pension scheme.

Date:18 September 2020

By: Anton van Zyl

Anton van Zyl has been with the Zoutpansberger and Limpopo Mirror since 1990. He graduated from the Rand Afrikaans University (now University of Johannesburg) and obtained a BA Communications degree. He is a founder member of the Association of Independent Publishers.

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