Pensioners can sue Transnet for R80bnComment on this story
Pretoria - Two Transnet pensioners were on Thursday given leave to institute an R80 billion class action suit against the parastatal and their pension funds.
Judge Ephraim Makgoba granted an order in the High Court in Pretoria to pensioners Johan Pretorius and Johan Kruger to launch a class action on behalf of Transnet's 62 000 impoverished pensioners, in an attempt to recover close to R80bn in assets and interest.
The group has accused Transnet of stripping the Transnet Pension Fund and Transnet Second Defined Benefit Fund (TSBF) of its assets and mismanaging them to such an extent that the funds were unable to meet their obligations to members.
They have also accused Transnet of attempting to dissolve the pension fund.
Increases to pensions have been limited to two percent for close to the past decade, reducing most of the pensioners to poverty.
The court was told that numerous pensioners received only R1 per month.
Currently 80 percent earned less than R4 000 per month and 62 percent less than R2 500 per month.
Most of them were between 70 and 90 years old and could no longer find employment.
The vast majority often had to beg for the most basic means and a number had committed suicide as a result of being unable to live with dignity.
About 30 percent of the Transnet pensioners were black.
Transnet in 2001 exchanged government bonds worth R7.7bn which earned the fund R1.2bn in interest per year for shares in M-Cell which earned no dividends.
The shares were sold in 2006 at a loss to the TSBF of over R5.4bn.
R800 million in surplus funds, created by the reduction of member benefits, was paid to over to Transnet in 2000.
The pension fund, Transnet, and the ministers of finance and public enterprises have opposed the application. They argue it is bad in law, of no substance, and a waste of time, effort, and money.
Judge Makgoba said in his view the papers before court identified a triable issue between the parties.
He directed the administrator of the pension funds, Metropolitan, to help the applicants give notice to members of the funds of the envisaged class action. A notice also had to be published in newspapers.
The two pensioners were given 60 days to institute the class action. Transnet and the pension funds were ordered to pay the legal costs of the application.