The "Who Profits from Unpaid Pensions? An Open Secrets Investigation" report, published in November 2019, dives into the complex issue of the disturbing R42billion in unclaimed pension benefits owed to 4 million South Africans.

Their investigation takes a hard look at the challenges and neglects within the pension fund industry and brings to light how fund administrators and regulators are handling and supervising these pension funds. It talks about the implications of pension fund cancellations, growth of Unclaimed Benefits Funds(UBFs), and intricacies of fund management. Featuring personal stories from pensioners who’ve been directly affected by these issues, the report emphasizes the importance of protecting the interests and well-being of South Africa's elderly population. Ultimately, it stresses the critical need for comprehensive reform and better accountability measures.

Key finding of the report:

1.     Cancellation of 6,000+ pension funds between 2007 and 2019, often wrongfully, with many of these still owing benefits to members.

2.     How private fund administrators, initiated the cancellation of thousands of funds, often without making sure that these funds did not still hold unclaimed benefits.

3.     Significant increase in unclaimed benefits from R450 million (2008) to R8 billion+ -suggesting a conflict of interest among fund managers who profit from unpaid benefits.

4.     Failure of regulators to effectively oversee and step in to ensure that right action is taken, leading to a lack of accountability and protection for members.

 

Click here to read the full report published by Open Secrets.

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