State power utility Eskom has debt of R460 billion. Picture: Henk Kruger/African News Agency (ANA)
State power utility Eskom has debt of R460 billion. Picture: Henk Kruger/African News Agency (ANA)

It is 'morally wrong' to bailout SOEs with pension fund money, says trade union Solidarity

By ANA Reporter Time of article published Feb 28, 2020

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Durban - Trade union Solidarity said on Friday that it would not allow the ANC to "steal our future" by utilising pension funds to bailout failing state-owned enterprises (SOEs). 

The union said it "strongly condemned" statements made by finance minister Tito Mboweni and public enterprises minister Pravin Gordhan that they were open to using pension funds to save looted and poorly managed SOEs. 

"These ministers have stated on two separate occasions, regarding the budget speech, that they are in favour of a plan where pension funds are used to fund struggling state-owned enterprises. Minister Mboweni even stated that private pension funds should also be used and not just the state pension fund," said Solidarity chief executive, Dr Dirk Hermann. 

While Mboweni did not expressly say he was in favour of using private pension funds, he said the funds should also be considered to alleviate some of state power utility Eskom's R460 billion debt.  

"If we go the pension route, it must be all of us. It can’t [just be] public servant pensions. It must be all pensions," said Mboweni on Thursday. 

The proposal to use the pensions of public sector employees to bailout Eskom was first made by trade union federation COSATU. Mboweni called it a "good idea" that should be "encouraged". 

But Hermann branded the statements "careless" via an emailed statement on Friday, saying the utterances caused panic among workers "who will not sit back and look how their savings are being thrown into mismanaged state institutions. There is no responsibility and the easy option now is pensions."

“Pension money is holy money – it is a lifetime’s savings. If you loot this money, you are stealing from someone’s old age. It is morally wrong, and we will fight it with everything in our power,” added Hermann. 

He said Mboweni suggesting that all pensions be used was tantamount to prescribed assets undertaken by the Apartheid government. 

“If the government wants pension funds to invest in state-owned enterprises, the solution is simple. Make state-owned enterprises attractive investments. Then people will stand in queues to invest and you do not have to force them into legislation."
 
Although "hijacking of pensions" was a major concern, said Hermann, nothing tangible had yet come from government. 

"Careless statements are made, but it is never committed to any plan. This indicates a government that desperately hope that we will [cease] to resist so that they can strike. We dare not lie down. 

"Unfortunately for them, Solidarity is quick-witted in our strategy to fight the hijacking of pensions. We have positioned ourselves squarely between the government and your savings and we are not going anywhere,” said Hermann.
 
He said Solidarity would be holding a "blitz seminar" on "the hijacking of pensions" on March 3. The seminar would look at what the government may or may not do, and how it could be stopped. 

African News Agency

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