In November 2019, Open Secrets released its investigative report The Bottom Line: Who Profits from Unpaid Pensions? The investigation catalogues the cancellation of over 6000 pension funds in both flawed and unlawful ways. Hundreds of these funds still had not paid out their members. The Bottom Line implicates private fund administrators and the regulator – the Financial Sector Conduct Authority (FSCA) – in failing to fulfill their legal duties during the cancellations scheme, and avoiding accountability in the fall-out.

Beyond the cancellations scheme, there are also billions in unpaid benefits that remain in active funds. These include dedicated ‘unclaimed benefits funds’ set up by fund administrators to preserve the benefits until their beneficiaries are found and paid. Fund administrators and asset managers continue to earn fees from these assets. Yet, administrators, fund trustees and the regulator – despite significant resources – have not done enough to ensure that these funds are paid.

The Bottom Line was accompanied by a booklet, Look Beyond the Bottom Line, which tells the stories of pensioners and other beneficiaries from the Unpaid Benefits Campaign and the Cape Town Ex-mineworkers Forum. Their stories highlight how an unscrupulous industry, including ex-employers, fund trustees and fund administrators, has dragged them from ‘pillar to post’ with little consideration for their plight. Many of the people we spoke to live in dire poverty and explained how receiving their benefits would allow them to fix their homes, feed their families and retire with dignity. Many of them were grandparents and the primary caretakers of grandchildren who they support on the measly state pension. During the interviews, some of these children played outside or sat next to their grandparents as they relayed their stories.

We also spoke to Tshidiso who at 36 was the youngest of our interviewees. Tshidiso, and his family are looking for the benefits owed from the 20 years that his grandmother, Anastasia, worked as a cleaner for the Telephone Manufacturers of South Africa (TEMSA). Unfortunately, Anastasia passed away in 2007 and it was only in 2012 when her family discovered that she may have been owed benefits.

Anastasia like many people then and now, did not have a clear understanding of the deductions on her pay-slip or the pensions industry in general. This is a systemic problem in how employers, pension funds and their administrators fail to communicate clearly to employees about their benefits and associated rights. Tshidiso’s family was only alerted to the issue of his grandmother’s potential benefits by talk of surplus payments for those who had worked at TEMSA in their neighbourhood of KwaThema. Surplus assets are the difference between what a fund owes its members and the market value of the assets it holds; it can, on occasion, be paid to the fund members in addition to their main benefit.

Tshidiso’s family went to enquire about this at MIBFA’s offices. They were told that his grandmother did not qualify because the surplus only became payable in 2008, a year after she passed away. Despite being heartbroken by the arbitrariness of this decision they have continued to look for Anastasia’s main pension benefits as they still qualify to receive it as her beneficiaries.

Tshidiso’s family is poor and unable to secure adequate health care for his disabled mother and aunt. Tshidiso was unable to finish his degree at the University of Johannesburg because his family did not have enough money to continue to pay for his fees. He has since struggled to find work.

Tshidiso’s story mirrors that of many young South Africans who are forced to drop out of university due to lack of finances and an ever expanding youth unemployment rate. Even with financial assistance, only 34% of financial aid students graduate from university. 

For Tshidiso, the financial barrier to his higher education degree could be eliminated by his family receiving his grandmother’s benefits. He would be able finish his final year at university, which he believes will aid him significantly in his job search. His family would also be better able to access essential care for Tshidiso’s mother and aunt.

Tshidiso’s story embodies the multi-layered and inter-generational effects of exclusionary systems. To look for his grandmother’s pensions, his family uses the photo of her receiving a long-time service award from TEMSA, and her ID document. They do not have her payslips or any other record of her employment. Just the framed photo. In the photo, Anastasia is shaking the hand of a white man at an awkward distance – a familiar symbol not of the COVID19 era but of the racial segregation of apartheid.

After months of listening to people relate the stories of the horrors of working in harsh conditions and for little pay during apartheid, the image of Anastasia receiving that certificate and listening to her family’s contemporary struggles brought home the magnitude of the impacts of racialised labour and the maladministration of the pensions industry.

When speaking to the ex-mineworkers, many of our interviewees revealed that they used their Blue Cards from the mines, or their passbooks, to prove their work record. Just like the passbook or dompas, the photo of Anastasia’s long-time “service” award is a symbol of the draconian and exploitative aspects of Apartheid. The fact that many Black people are forced to rely on these symbols to access their rights in post-Apartheid South Africa highlights the continued racialised socio-economic exclusion of Black people .

Poverty is cyclical in its nature. Poor people experience barriers to education and basic services, meaning that their children are unlikely to progress out of the social class they are born in. The payment of Anastasia’s benefits will not fix our deeply unequal society, but it would be the first step towards economic justice for Tshidiso and the rest of her family. It would help her grandson in his attempts to break the long generational chain of poverty and help him provide for his own son, who is dependent on two unemployed parents and the state child support grant.