South Africa: Brian Molefe's Eskom Retirement Fund Saga Is Just the Tip of an Iceberg

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It was not only former Eskom CEO Brian Molefe who unlawfully participated in and profited from an Eskom Pension and Provident Fund membership. Other people in power were also given access to employment perks they were not entitled to. It is costing current contributors their capital and leaving pensioners poorer in payouts. It is a problem far from being solved.

South Africa's sluggish economy and the importance of "fund stability" were recently quoted by the Eskom Pension and Provident Fund (EPPF) as the main reasons it could only afford to pay pensioners a paltry 2% increase in their monthly pension payments in 2020 -- and active members had to be happy with a mediocre increased investment return of 4.5%.

"Increases aren't guaranteed," the fund told its members in a memo, and "you are lucky you got anything at all," it added.

But that is much further from the truth than the fund is prepared to admit.

In terms of fund rules, fixed-term contract workers are not permitted to become fund members, which is reserved for formal employees. This was exactly the problem with Molefe's surprise pension windfall which was ruled partly illegal in an extended court process.

The EPPF rules,...

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