SAMWU CONDEMNS RAMPANT PENSION DEFAULT BY MUNICIPALITIES IN THE FREE STATE, CALLS FOR MUNICIPAL MANAGERS TO BE HELD LIABLE.
1 October 2024
SAMWU CONDEMNS RAMPANT PENSION DEFAULT BY MUNICIPALITIES IN THE FREE STATE, CALLS FOR MUNICIPAL MANAGERS TO BE HELD LIABLE.
The South African Municipal Workers Union (SAMWU) in the Free State is appalled and deeply frustrated by the recent report from the Financial Sector Conduct Authority (FSCA), which reveals the alarming number of municipalities defaulting on pension fund contributions. This reckless dereliction of duty not only undermines the financial security of municipal workers but also directly jeopardises their ability to access much-needed relief in times of crisis.
We are horrified that thirteen of the seventy-seven municipalities in default nationwide – a staggering 22% – are in the Free State. This is a clear and shameful indication of mismanagement, reflecting a complete disregard for the well-being of municipal workers.
The FSCA’s Communication 10 of 2024 exposes a gross violation of the Pension Funds Act, particularly Section 13A(3)(a), by these municipalities. This failure is not just a breach of law but a devastating betrayal of workers’ rights. Thousands of our members have been left unable to withdraw from the Two Posts system, denying them the temporary financial relief they urgently need. This neglect is an assault on their dignity and livelihood, pushing workers deeper into financial hardship.
SAMWU is enraged by the scale of this crisis. The publication of these defaulting municipalities is a damning testament to the failure of governance. These municipalities have abandoned their responsibilities, and SAMWU will not tolerate this blatant exploitation of workers who have dedicated their lives to public service.
The consequences of these pension arrears are catastrophic. Beyond the legal violations, these defaults have created an environment of insecurity, fear, and anxiety for municipal workers. Many have been left in financial limbo, unable to access their retirement savings or take advantage of relief mechanisms. We demand that municipalities immediately rectify this situation by settling their outstanding contributions to restore the trust and financial security of their employees.
Moreover, SAMWU calls for urgent and decisive action from the FSCA and relevant authorities. Municipal managers, who are entrusted with overseeing the proper functioning of these institutions, must be held personally liable for this gross mismanagement. They cannot be allowed to shirk their responsibilities while workers suffer the consequences. Accountability is non-negotiable, and we demand that these managers face the full force of the law for their failures.
The silence and inaction of the Provincial Treasury and the Free State Department of Cooperative Governance and Traditional Affairs (COGTA) are equally troubling. Their failure to act as municipalities push workers into poverty is an unacceptable betrayal of democratic principles. SAMWU will not stand by as workers are exploited by a system meant to protect them.
Furthermore, we hold pension funds accountable for their failure to uphold their fiduciary duties under the Pension Funds Act. They have neglected their responsibility to ensure compliance with the law, allowing this crisis to escalate unchecked. Pension funds must be held to account alongside municipalities for this disaster.
SAMWU is unwavering in its commitment to defending the rights and livelihoods of municipal employees. We will escalate our efforts to ensure that those responsible for this injustice are held accountable and that every worker receives the pension benefits they are owed. We demand immediate action to end this crisis and prevent further harm to our members.
Issued by SAMWU Free State
Thabang Tseuoa,
Provincial Secretary
082 620 9160
Or
Sandla Mahlathi,
Deputy Provincial Secretary
072 658 0725