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DA: Compensation fund in state of chaos

Feb 17 2013 18:02

Johannesburg - The labour department's compensation fund should be placed under administration by the treasury, the Democratic Alliance said on Sunday.

"The compensation fund is in a state of chaos," said the DA's Sejamothopo Motau.

He said a briefing held this week for the portfolio committee on labour indicated that the fund - meant to assist sick and injured workers - was "no longer able to function properly".

Motau said the fund had received four previous qualified audits in a row.

"The result is that the fund has failed to pay more than 120 000 medical invoices, even as it sits on a R14bn surplus."

He said that while the department had launched its own forensic investigation into the matter, the DA wanted treasury to get involved.

Motau said he would be writing to Minister Mildred Oliphant about the matter: "I will therefore request that a treasury task team be set up to administer a clean-up of the compensation fund.

Labour ministerial spokesperson Musa Zondi said that he did not have comment regarding the DA's call for the fund to be placed under administration.

He said the problems with the fund were being sorted out.

"We are quite confident with what we are doing," said Zondi.

Next month, the trial of three people accused of defrauding the department of labour's compensation fund resumes in the Pretoria Magistrate's Court.

Former fund employees Maxwell Ramaphosa, Samuel Mfeleng and Kgabo Johanna Methi are accused of 15 counts of fraud and 26 counts of money-laundering involving almost R500 000.

They allegedly collaborated with Rustenburg physiotherapist Jones Modau to siphon money into his account from the Compensation Fund.

Modau has already been sentenced after he pleaded guilty last year to the three counts of fraud and 14 counts of money-laundering.

Ramaphosa and Mfeleng - who have pleaded not guilty, along with Methi - are also involved in two other fraud cases involving the department of labour.

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