Johannesburg – The Pension Fund Adjudicator has signalled a tougher approach to employers who fail to pay retirement fund contributions to funds on behalf of their employees.
The Financial Sector Conduct Authority (FSCA) reported a few months ago that employers had not paid over R8,3 billion to retirement funds.
Local government was responsible for about R1,7bn of these outstanding contributions.
Addressing the annual conference of the Institute of Retirement Funds Africa (IRFA) this week, Pension Fund Adjudicator, Advocate Lebogang Mogashoa, noted that 51% of all complaints submitted to the Office of the Pension Fund Adjudicator (OPFA) in the last financial year related to non-payment of contributions by employers.
“This is a big risk to the generation of positive outcomes for members,” he noted.
Advocate Mogashoa said the OPFA had to make “maximum use” of the resources and authority given to it by legislation to deal with this non-payment.
This included issuing orders against employers and/or responsible persons requiring payment.
Advocate Mogashoa said there was a false perception that the OPFA did not have the power to issue orders, which often prompted funds to resort to the courts.
The Pension Fund Adjudicator stated the Pensions Fund Act empowers the OPFA to proactively join any respondent in its proceedings and possibly issue an order against them.
This applied not only to complaints by retirement funds but also by individuals.
“This is the direction of travel. This is where we want to go,” Advocate Mogashoa said.
The Pension Fund Adjudicator said he believed the use of these powers by the OPFA would prompt a shift in behaviour.
The act also allowed the office to issue subpoenas, and draft guidelines for this were posted on its website for comment.
This would address the problem of employers and responsible persons often not responding to complaints.
Advocate Mogashoa revealed that the five-year average of complaints received by OPFA was 10 119 per financial year, with a record 13 041 having been received in the 2025/26 financial year.
In the year to date to end-August this year, 5 059 complaints had been received.
This was a 13% reduction compared with the same period in the previous financial year when 5,797 complaints were received.
Gauteng, KwaZulu-Natal and Western Cape generated the most complaints.
Mogashoa stressed that the OPFA wanted to achieve the same things as retirement fund administrators and trustees, namely to achieve positive outcomes and security in retirement for members.
This was made difficult by the increasing complexity of legislation and regulations, which was putting pressure on the OPFA’s ability to work with industry to achieve this.
The adjudicator, he added, was not a police officer for the industry but a value co-creator, providing effective redress for members.
It had to be acknowledged that the mere fact that there was a complaint meant that something had gone wrong and had to be addressed through a partnership between the industry and the OPFA.
Advocate Mogashoa acknowledged that complainants wanted their disputes resolved speedily.
Most were resolved by the office in six months, but Advocate Mogashoa said this “is quite frankly still too long. We need to prioritise resolving complaints as quickly as possible.”
He said the industry also needed to try to settle disputes instead of just waiting for a ruling by the OPFA.
Another initiative outlined by Advocate Mogashoa was to use technology to better serve the industry, replacing legacy processes and systems to make them more effective and to improve turnaround times.
Advocate Mogashoa said Artificial intelligence will also be used to process complaints.
