Johannesburg - At least 3.5 million people are set to be owed about R20 billion in retirement fund benefits that have not been claimed, with at least R5.2 billion being owed to 200 000 miners.
This is according to the Financial Services Board, which yesterday briefed the media on why these funds are unclaimed, and urged funds to do more to pay out these benefits.
In a statement, deputy registrar of pension funds, Rosemary Hunter, said retirement funds must take all reasonable steps to trace and pay millions of their members and beneficiaries who remain untraced.
Before 2008, benefits that were not claimed reverted back to funds. However, that changed when a circular was issued directing funds to retain liabilities for unclaimed benefits, and house the benefits in special purpose retirement vehicles.
According to the board, there was R15.8 billion in unclaimed benefits, owed to 3.07 million people, in 2013. As funds grow each year, so the value of unclaimed benefits increases, it notes.
The FSB notes there are 50 ‘active’ and registered unclaimed benefit funds with an estimated R4.6 billion in unclaimed benefits owed to 792 000 beneficiaries.
In addition, the board says, its figures excludes funds established under other laws, such as the Government Employees Pension Fund, the Telkom Pension Fund, the Post Office Retirement Fund and the three Transnet funds. It notes it has been reported that there is about R456 million unclaimed under these funds.
These funds often remain unclaimed for several reasons, the board says, which include that membership data is invalid or incomplete, the funds don’t have the expertise to trace the beneficiaries, and members may not know they are entitled to the benefits.
Hunter says “funds should insist that employers supply them with up-to-date contact information, including ID numbers, cell phone numbers, etc. The funds must consider the use of social media as a means for advertising unclaimed benefits or for tracing beneficiaries,.”
The FSB also warned potential beneficiaries to be wary of intermediaries who offer to help them claim benefits, often charging an exorbitant fee, as it is important to establish if the intermediaries are authorised by the funds to perform this function – in which case it is the fund that must pay for the service, not the members.
It adds it helps members or beneficiaries in trying to trace benefits or shares of allocated surpluses they believe to be due to them, if provided with relevant and sufficient information, at no charge to the member.
IOL