The administrator of the Private Security Sector Provident Fund (PSSPF), Salt Employee Benefits (Salt EB), has issued a statement hitting back at recent media coverage alleging maladministration of the fund. These include recent comments by Jones Maphalaphatwa, president of The Association of Private Security Owners of South Africa (Tapsosa).
Eddie Strydom, chief executive of Salt EB, says in the statement: “Salt EB rejects, with contempt, the untruthful insinuations made by Mr Maphalaphatwa, president of Tapsosa, in a recent television interview. The allegations relate to alleged maladministration of the PSSPF.
“Salt EB took over the administration of the PSSPF in 2016, after entering into a contract with the fund. At the date of Salt EB’s appointment, the PSSPF had a substantial withdrawal claim backlog and a sizeable burden of unallocated contributions. Salt EB’s agreed-upon task was to assist the PSSPF in fulfilling their duties to their members: to look after their members’ savings safely and appropriately in a well-administered fund.
“Salt EB is exceptionally proud of the work that it has done since taking over the administration of the fund in 2016.
“Salt EB has significantly improved the administration of the PSSPF, not only by ensuring accurate administration but also by maintaining and enhancing compliance with the applicable regulations. We have reduced the PSSPF’s unallocated contributions by more than 75%. Moreover, while under our administration, the PSSPF has been able to submit unqualified audited annual financial statements for the last two financial years – a remarkable achievement in an industry in which financial maladministration is rife.
“Despite this hard work, there remain several issues at the PSSPF that Salt EB is working hard – together with the fund’s trustees – to resolve.
“In her recent annual report, the Pension Funds Adjudicator, Adv Muvhango Lukaimane, pinpointed a major issue facing the PSSPF, namely employer non-compliance. There is a growing trend amongst employers in the private security sector which involves deducting pension fund contributions from employees’ salaries and not paying these deductions over to the PSSPF. While there are compliant, ethical and diligent employers in the sector, there is a growing number of security companies which are treating their employees like a bank, ‘borrowing’ against their employees’ futures by holding onto their pension fund contributions.
“The results of employer non-compliance can be catastrophic for security workers and their families. Workers who have, for years, seen deductions coming off their pay slips, are told there is no money for them in the pension fund upon their retirement, because their employers have not paid the deductions over to the retirement fund. As the party who interacts most directly with the worker, the pension fund’s administrator is then often misguidedly blamed for the non-payment of the expected benefit.
“Tapsosa represents several security companies who are repeat offenders when it comes to employer non-compliance. Mr. Maphalaphatwa’s allegation that Salt EB is the reason for issues at the fund, when most of these are due to the actions of unscrupulous employers, is clearly an attempt to deflect attention from the wrongdoing of non-compliant TAPSOSA members.
“In contrast to Tapsosa, Salt EB is working hard to address the problem of employer non-compliance with respect to the PSSPF. For example, Salt EB has set up a mechanism – the Benefit Counsellor tool – whereby employees can check if their employers have in fact been paying over their contributions for the preceding 12 months and take action if this is not the case.
“While the issues facing the sector-specific pensions industry in South Africa are immense, Salt EB continues to believe that real change – which protects workers’ futures – is possible. Salt EB is an agent of that change and remains undeterred by attempts to deflect accountability through false accusations,” Strydom said.
PERSONAL FINANCE