According to finance minister Enoch Godongwana's replies to EFF MP Ntokozo Mkhonto in parliament recently, retirement funds must take all reasonable steps to ensure that contributions are paid timeously to the fund as per the act.
“Boards are required to report nonpayment of pension contributions to the FSCA, inform members and report to police where applicable. The FSCA monitors reports received from retirement funds and is empowered to charge penalties in cases of noncompliance.”
He said the funds are required to communicate with employers about the actions taken to recover outstanding contributions and the reasons for the partial or nonpayment of the contributions.
The owner of Sorbet at Eastgate said she took over the shop in June last year and is still paying off her debt for its purchase. She said so far she has paid R60,000 to the fund and in October she made an arrangement with her fund administrator to pay off outstanding debt for her nine employees who each contribute R400 per month.
“Some employees are registered but I wasn't even deducting from them because some of them are still under the old employer's details and not my company details,” she said.
Pius Batsile, spokesperson for Ditsobotla municipality in North West, said they could not pay over their employees' contributions due to financial difficulties caused by poor revenue collection.
“The employees are aware because the municipality is communicating with them monthly. Also, their different pension funds are sending them SMSs to update them about the nonpayment of their contributions by the municipality.”
He said the municipality is working on a plan to improve revenue collection and hopes to pay outstanding pension debt by the end of December.
EThekwini, Ekurhuleni, Emfuleni, Enoch Mgijima and Vhembe municipalities said their accounts were up to date as they had made arrangements with retirement fund administrators before the release of the list of defaulters last month.
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