Pensioners set to sue TransnetComment on this story
Johannesburg - About 70 000 pensioners belonging to two Transnet pension funds are lodging an application for a class action against the state-owned logistics firm to pay about R80 billion into the funds, which they argue is owed to them by the state.
There was no reply from the National Treasury yesterday to questions put to Finance Minister Pravin Gordhan.
However, Freedom Front Plus MP Anton Alberts, who has been acting as a facilitator of the legal action for the pensioners, said he was hopeful that there would be a court hearing within weeks before the North Gauteng High Court.
Mayihlome Tshwete, the spokesman for Public Enterprises Minister Malusi Gigaba, said the matter of changing the rules of the Transnet Second Defined Benefit Pension Fund and the Transport Pension Fund to allow for inflation-linked pension increases in future “has still not been signed”.
Although the rule changes had been agreed to in principle more than two years ago, Tshwete said the minister did not wish to land in a situation where the pension funds were unsustainable. “We don’t want Transnet to have to find funding for the pension fund as a consequence of it going into a deficit that it can’t sustain.”
Jaco Neale, the secretary of the two funds, confirmed that any rule changes “will affect the financial position of the funds. They need to be approved by the minister of public enterprises with the concurrence of the finance minister.”
He said annual increases for pensioners had been pegged at 2 percent, while a bonus of one month’s pension was routinely paid out in the month that the pensioner originally retired.
Pensioners belonging to the defined benefit fund have had their pension increases pegged at 2 percent a year since the 1990s. The consequence is that the average monthly pension for the 66 000 pensioners in the fund is just R2 000. Some 32 000 pensioners have died since the fund was formed in 2000.
There are about 4 000 pensioners remaining in the Transnet Pension Fund.
Alberts said there had been tremendous foot-dragging by the state – including Transnet – for years. “Some pensioners end up with R1 income a month after medical aid contributions are paid… It is simply an outrage to treat people in this manner.”
The poor pensions were a result of raises having trailed the annual rise in the consumer price index for years.
He noted that the defined benefit fund had been short-changed in Transnet’s sale of the V&A Waterfront asset, as well as Transnet’s decision to dispose of T011 shares guaranteed by the state. Transnet exchanged these, worth about R10bn in 1990, for MCell shares in 2001. Alberts noted that the T011 shares had paid out dividends, unlike the MCell shares.
The pensioners’ attorney, Wynanda Coetzee of Geyser & Coetzee Attorneys, argued that the fund lost about R5.5bn during this particular transaction.
Cumulatively, the pensioners say the funds have been short-changed by R80bn – about R35bn for the Transnet Pension Fund and R46bn for the defined benefit fund.
Coetzee said the matter had its origins in 1988 when the then state president confirmed that SA Transport Services would become a commercial business. The government promised to protect the members of the then SA Transport Services Pension Fund, a predecessor fund.
In a reply to Alberts in Parliament last year, Gigaba said if a class action were to be instituted “it will significantly impact upon Transnet’s ability to negotiate loans for the R300bn expansion programme”.