Kopanong pension scandal: FS court questions lack of criminal action


The Bloemfontein High Court in the Free State questions why criminal action is yet to be instituted against Kopanong Local Municipality for their failure to pay over third party contributions to the tune of millions.

Judge Johannes Daffue posed the question during a judicial review on Monday 16 September, launched by the Municipal Workers’ Retirement Fund, formerly known as the South African Municipal Workers’ Union (Samwu) National Provident Fund regarding the November 2018 High Court order that blocked an auction of Kopanong’s assets at the eleventh-hour.

Daffue stresses Kopanong “is liable criminally for not paying over pension fund contributions” and he is at a loss as to why no criminal action has been launched. The cash-strapped municipality is accused of defrauding its workers in third party contributions to the tune of close to R80 million with the debt to the Municipal Workers’ Retirement Fund alone making up over R2 million. In 2018, Samwu opened an official case against the municipality with police. The matter has, however, stalled.

Meanwhile, the Kopanong Local Municipal Council in the Free State has since March 2019 placed the Municipal Manager, Martin Kubeka, on special leave pending a probe into maladministration allegations levelled against him by employees. These allegations centre on the municipality’s failure to settle money owed to third party contributions. In suspending Kubeka, the council succumbed to pressure from the employees who at that stage, were on strike action, nearing three weeks. Following the suspension, the provincial Department of Cooperative Governance and Traditional Affairs (Cogta) deployed a task team to also look into the matter. OFM News spoke to Cogta MEC, Thembeni Nxangisa recently and he says there are no updates on Kopanong as yet, but the department is continuing to provide support.

Regarding the Municipal Workers’ Retirement Fund’s review it was revealed that Kopanong’s Hail Mary was granted not because that was the relief they sought in their November application, but as a result of a slip of the tongue from the municipality’s legal counsel Andre Burger.

According to Burger, Kopanong initially sought interim relief pending finalisation of the matter in February 2019, however, a demand made in the “heat of the moment” by Burger regarding the finalisation of the payment plan led to what Daffue refers to as the “wrong” judgment. Van Den Berg argues the order, as it stands, enables the municipality to cherry-pick which creditors to pay, prejudicing his clients. He asks that the order, as it stands, be set aside. Burger, however, wants the matter to be referred back, as opposed to it being set aside, despite acknowledging the mistake on his part. He maintains the order was in its essence granted on the merits of their initial case.

Judgment on the matter has been reserved.

OFM News/Olebogeng Motse