Londiwe Buthelezi
Sizwe Medical Fund’s curator, Ngubekhaya Gobinca, has warned that the disruption of the annual general meeting (AGM) last Friday could affect the period for which it was placed under curatorship.
Gobinca walked out of the AGM. Sizwe said he did so because a group of delegates disrupted the meeting.
The National Union of Metalworkers of SA (Numsa) said Gobinca was not intimidated or threatened during the meeting.
The union said it would seek a legal opinion regarding his walkout and the subsequent status of the AGM.
During the curatorship period, Gobinca is handling all the affairs of the scheme, playing the role of both the board of trustees and chief executive.
The curatorship is supposed to end in September this year, but Numsa has been calling for Gobinca’s suspension since last month. The union has a business interest in Sizwe though Numsa Financial Services, which provides medical aid brokerage services.
Sizwe said: “The curator believes the disruption of meetings will only serve to delay the conclusion of his mandate and ultimately might impact on the upliftment of the curatorship.”
Monwabisi Gantsho, the registrar and chief executive of the Council for Medical Schemes (CMS), said that the curatorship of any scheme was not indefinite but the lifting of a curatorship would be done only when a scheme’s governance issues were resolved. In Sizwe’s case, the issues would need to be resolved as per the court order granted last year.
The order gives the curator the discretion as to when elections for the board of trustees can be held. Before he can do that, he has to rehabilitate, strengthen and streamline operations at Sizwe.
Gobinca’s tussles with the union came as he was reviewing all main supplier contracts at Sizwe. Sechaba, the scheme’s administrator, is among these.
Gobinca said Sechaba’s current contracts were put on notice to allow for a proper procurement process to begin.
Sizwe is the only scheme that Sechaba administers.
Gobinca said if Sechaba wanted to keep its contracts, it must participate in the procurement process.
Sechaba chief executive Grant Newton said Sechaba did not receive prior notification about its contracts being put on notice and it was disappointed with the situation. However, Sechaba wanted to find an equitable solution.
“We believe that Sechaba is offering a fair value service at a market-related price and that we are operating within our service level requirements,” Newton said.
A recent independent study commissioned by Towers Watson Actuaries indicated that Sechaba’s administration fees were in the lower percentile in the industry.
But Gobinca said Sechaba’s new long-term contracts were awarded without a tender process last year.
“It has been declared by the registrar, in accordance with the CMS and the minister of health, that it is an undesirable business practice for a medical scheme to award a contract for administration services without engaging in a fair and reasonable process of evaluating a range of potential administrators,” Gobinca said.
The curator also confirmed that the scheme was exploring the possibility of merging with other schemes.
Gobinca said this would be done to grow Sizwe, which would provide scheme members with a broader selection of benefit options.
The CMS said it did not suggest or initiate amalgamations between medical schemes but it was willing to meet soon with all parties concerned to discuss the possible mergers that Gobinca referred to.