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Cape Town - Transnet Group chief executive Brian Molefe and four of eight pension fund trustees made the decision to appeal against an R80bn class action suit by over 60 000 poor pensioners against two Transnet pension funds.
This has emerged in an answer to a question in parliament by Public Enterprises Minister Lynne Brown. “After extensive discussions by the board of directors, the board did not vote on the matter but delegated this and other matters to the group chief executive... including any legal matters related to this class action,” she said.
Freedom Front Plus MP Anton Alberts asked whether the chairperson and Transnet board directors had voted to oppose the class action against the state-owned transport company instituted by pensioners of the Transnet Pension Fund (TPF) and the Transnet Second Defined Benefit Fund (TSDBF).
Alberts also asked whether the board of trustees of the two pension funds had voted to oppose the class action.
Brown said: “Transnet opposed the court case on the basis that the applicants failed to make a case for class action, the applicants failed to satisfy the requirement of section 38 of the constitution on class action (and) Transnet is of the view also that the applicants should pursue other avenues available, such as instituting individual action, to obtain remedial action.”
Referring to the board of trustees of the TSDBF, she said four Transnet-appointed trustees voted to proceed with the appeal and four pensioner-elected trustees voted against the appeal. “The chairman of the board of trustees (Transnet director and labour lawyer Harry Gazendam) exercised the casting vote to proceed with the appeal,” Brown divulged.
She also reported that the principal officer of the Transnet Pension Fund, Peet Maritz, took the decision to appeal the judgment based on legal advice from the fund’s legal team and senior counsel.
Asked by Alberts for which reasons the trustees decided to oppose the court case, Brown said the TSDBF and the Transnet Pension Fund took the decision to oppose the court case on the basis that the applicants failed or did not articulate “a triable issue” in respect of any claims against both funds.
“Other reasons are based on issues of law such as the fact that the particulars of (the) claim did not disclose a proper cause of action,” Brown reported.
Other arguments were that the concept of reasonable benefit expectation “as espoused in the Pension Fund Act and sought to be enforced by the applicants was not applicable in this matter”, Brown stated.
The class action has been led by two Transnet pensioners, Johan Pretorius and Johan Kruger. Judge Ephraim Makgoba granted an order in the Pretoria High Court in July to the pensioners to launch a class action. The pensioners argue that Transnet stripped the TPF and TSDBF of their assets and have mismanaged them.
Living on R200 per month
Pensioners’ increases have been limited to 2% for over a decade. Some earn as little as R200 a month but the average pensioner – with an average age of 77 – earns less than R3 000.
The pensioners have argued that they have been diddled out of billions of rands through poor management of the funds. For example, Transnet in 2001 exchanged government bonds worth R7.7bn which earned the fund R1.2bn in interest per year for shares in M-Cell. But the shares were sold in 2006 and the TSBDF’s estimated loss was over R5.4bn.
In addition, R800m in surplus funds was paid over to the transport state company in 2000.
The Freedom Front Plus has led the charge in parliament for the Transnet pensioners – 30% of whom are black – and there have been countless hearings in the public enterprises portfolio committee, but there has been no political resolution to the dispute.
The appeal against the class action is expected to delay the hearing for some months.
- Fin24
This has emerged in an answer to a question in parliament by Public Enterprises Minister Lynne Brown. “After extensive discussions by the board of directors, the board did not vote on the matter but delegated this and other matters to the group chief executive... including any legal matters related to this class action,” she said.
Freedom Front Plus MP Anton Alberts asked whether the chairperson and Transnet board directors had voted to oppose the class action against the state-owned transport company instituted by pensioners of the Transnet Pension Fund (TPF) and the Transnet Second Defined Benefit Fund (TSDBF).
Alberts also asked whether the board of trustees of the two pension funds had voted to oppose the class action.
Brown said: “Transnet opposed the court case on the basis that the applicants failed to make a case for class action, the applicants failed to satisfy the requirement of section 38 of the constitution on class action (and) Transnet is of the view also that the applicants should pursue other avenues available, such as instituting individual action, to obtain remedial action.”
Referring to the board of trustees of the TSDBF, she said four Transnet-appointed trustees voted to proceed with the appeal and four pensioner-elected trustees voted against the appeal. “The chairman of the board of trustees (Transnet director and labour lawyer Harry Gazendam) exercised the casting vote to proceed with the appeal,” Brown divulged.
She also reported that the principal officer of the Transnet Pension Fund, Peet Maritz, took the decision to appeal the judgment based on legal advice from the fund’s legal team and senior counsel.
Asked by Alberts for which reasons the trustees decided to oppose the court case, Brown said the TSDBF and the Transnet Pension Fund took the decision to oppose the court case on the basis that the applicants failed or did not articulate “a triable issue” in respect of any claims against both funds.
“Other reasons are based on issues of law such as the fact that the particulars of (the) claim did not disclose a proper cause of action,” Brown reported.
Other arguments were that the concept of reasonable benefit expectation “as espoused in the Pension Fund Act and sought to be enforced by the applicants was not applicable in this matter”, Brown stated.
The class action has been led by two Transnet pensioners, Johan Pretorius and Johan Kruger. Judge Ephraim Makgoba granted an order in the Pretoria High Court in July to the pensioners to launch a class action. The pensioners argue that Transnet stripped the TPF and TSDBF of their assets and have mismanaged them.
Living on R200 per month
Pensioners’ increases have been limited to 2% for over a decade. Some earn as little as R200 a month but the average pensioner – with an average age of 77 – earns less than R3 000.
The pensioners have argued that they have been diddled out of billions of rands through poor management of the funds. For example, Transnet in 2001 exchanged government bonds worth R7.7bn which earned the fund R1.2bn in interest per year for shares in M-Cell. But the shares were sold in 2006 and the TSBDF’s estimated loss was over R5.4bn.
In addition, R800m in surplus funds was paid over to the transport state company in 2000.
The Freedom Front Plus has led the charge in parliament for the Transnet pensioners – 30% of whom are black – and there have been countless hearings in the public enterprises portfolio committee, but there has been no political resolution to the dispute.
The appeal against the class action is expected to delay the hearing for some months.
- Fin24
