Daily News Articles for the General Sector, 2008

Chantelle Benjamin, Business Day
Chief Reporter

AN ESKOM Pension and Provident Fund trustee, who was dismissed after blowing the whistle on a large severance payout to the fund’s former CEO, will take his complaint to the Pension Fund Adjudicator.

Joshua Mkhonza, who was elected as a trustee by fellow pensioners, alleged that the Eskom Pension Fund board of trustees excluded pensioners when making decisions that affected them , not the least of which was the payout from pension fund money to former CEO Terrence Chauke.

This will no doubt be a matter of concern to the 34000 pensioners looked after by SA’s third-largest fund.

Mkhonza was nominated before his dismissal for re- election as a trustee of the fund in this year’s elections.

Eskom Pension Fund t rustees did not respond to enquiries despite promises by Eskom spokesman Fanie Zulu and the f und’s electoral officer Kolisa Xinindlu that someone from the fund would reply to questions.

The Eskom Pension Fund trustees dismissed Mkhonza after he took the matter to the Financial Services Board (FSB) and the National Prosecuting Authority. He claimed the board was breaching the fund’s code of conduct .

Mkhonza alleged that the board refused requests for a forensic audit into the CEO and for pensioners and members to be properly informed about the results of the PricewaterhouseCoopers (PwC) investigation as well as the reasons for Chauke’s resignation.

Chauke resigned soon after a PwC probe into the payout of bonuses revealed that Chauke had paid himself benefits to which “he was not entitled”.

Mkhonza said he was told originally that Chauke had been suspended pending an investigation.

However, pensioners and members were told in April this year that Chauke had “resigned to pursue other opportunities”.

“It would appear that criminal acts are being covered up ,” Mkhonza said in his letter to Dr Elmarie de la Ray, legal adviser for FSB’s retirement funds division, in March this year.

Mkhonza alleged the fund had controlled disclosure of information and had greatly weakened the ability of the Eskom Pension Fund Association to carry out its mandate of safeguarding pensioners’ interests .

Pensioners questioned decisions which had seen lower increases for pensioners and which allowed Eskom to withdraw its commitment to meet any deficits which may arise.

Kennedy Memani, Eskom Pension and Provident Fund chairman, yesterday denied that pensioners were being ignored by the fund. “We consult them all the time and they are represented on the board of trustees. We did not change the rules to cheat pensioners.”

He said the fund no longer acknowledged the pension fund association as it did not exist legally and had no constitution .

“It was a body inherited from an old Eskom structure and mostly consisted of middle management, but it was not clear who it represented.”

Memani said Mkhonza was dismissed because he did not understand the issues.

“He kept going outside the fund to ask for advice from people who were not at meetings.”

Memani said that they were looking into the possibility of changing the rules of the fund to ensure that nominees met minimum standards and were “able to properly apply their minds to issues”.

Memani also denied that Chauke resigned over missing funds, but said Chauke had said at the start of the year that he wanted to pursue other interests.

This contradicts a memo sent on February 6 this year which said Chauke had been sus- pended. Memani said the PwC audit was normal proce dure following the awarding of bonuses, and occurred every year.