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Right to open, fair public hearings before tribunals reinforced by Supreme Court of Appeal

30 March 2015 It is a pity that National Treasury, the parliamentary standing committee of finance, Financial Services Board, their tribunals, lawyers and retirement fund industry will not be aware of the significance of the City of Cape Town v Sanral judgment. The importance of section 34 of the Constitution and its international law counterparts such as ICCPR (which South Africa has ratified) has been reaffirmed. Unfortunately we have to assume that the Pension Funds Adjudicator, FAIS Ombud, FSB Appeal Board etc will continue to operate unconstitutionally. 

Here is a case summary from the Registrar of the Court:

"MEDIA SUMMARY OF JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

FROM                           The Registrar, Supreme Court of Appeal

DATE                           30 March 2015

STATUS                       Immediate

Please note that the media summary is intended for the benefit of the media and does not form part of the judgment of the Supreme Court of Appeal.

City of Cape Town v South African National Roads Authority Limited & others (20786/14) [2015] ZASCA 58 (30 March 2015)

The Supreme Court of Appeal (SCA) today handed down judgment in a matter relating to access to court records and whether such records should be open to the public.

The appeal to the SCA by the City of Cape Town (the City) was against the judgment of the Western Cape Division of the High Court, Cape Town that held, in favour of the South African National Roads Authority Limited (SANRAL), that the publication of all information from the rule 53 record, including ‘the non-confidential record’ was prohibited until the review application was called.

Proceedings began in the Westen Cape Division of the High Court, when the City launched a review application in terms of rule 53 of the Uniform rules of court, seeking to review SANRAL’s decision to award the tender to Protea Parkways Consortium as the preferred bidder and Overberg Consortium as the reserve bidder in respect of what has been described as the N1/N2 Winelands Paarl Highway Toll Project. SANRAL furnished the City with the administrative record in terms of Uniform rule 53(1)(b) in two parts, marked respectively as, the ‘non-confidential record’ and ‘the confidential record’. That created a dispute between the parties as to precisely what constituted the rule 53 record. Having found that SANRAL had failed to make out a case in respect of each of the specified categories, the Western Cape Division dismissed SANRAL’s application. However, the court a quo went further to issue an order holding that the record disclosed by SANRAL is subject to the ‘implied undertaking rule’ (the rule) which meant that unless authorised by SANRAL or by the court, the administrative record was not to be disseminated or published before the review application.    

The SCA found that the rule had not been raised by SANRAL in its affidavit and that the City had thus not been called upon to answer that case in the court a quo. The SCA also found that the court below prohibited the publication of all information from the rule 53 record, including the non-confidential record, whereas SANRAL’s case was that: all such information, apart certain specified portions, could be made public immediately, while other parts of the information must be kept secret only until SANRAL filed its answering papers, not until the hearing.

The SCA held that the rule is not part of South African law. The notion of ‘open justice’ and the ‘open court principle’ which has been part of the South African law since the eighteenth century and other foreign jurisdictions is now constitutionally entrenched in section 34 of the Constitution.

The SCA further held that courts are open in order to protect those who use the institution and to secure the legitimacy of the judiciary, not to satisfy the prurient interests of those who wish to examine the private details of others. Without openness, the judiciary loses the legitimacy and independence it requires in order to perform its function. Accordingly, held the SCA, court proceedings should be open unless a court orders otherwise. The logical corollary must therefore be that departures should be permissible when the dangers of openness outweigh the benefits. And by extension, the right of open justice must include the right to have access to papers and written arguments which are an integral part of court proceedings.

The SCA held that the right to freedom of expression lies at the heart of democracy, and is one of a web of mutually supporting rights that hold up the fabric of the constitutional order. The media hold a key position in society. They are not only protected by the right to freedom of expression, but are also the key facilitator and guarantor of that right and thus, the media’s right to freedom of expression is thus not just for the benefit of the media, but it is for the benefit of the public. The Court held that both the rule and the court a quo’s interpretation of the rule 53(1)(b) thus impinge on open justice by preventing the public and media from being able to scrutinise court proceedings before a matter is heard, whereas there is a strong default position in our law against prior restraints on publication.

The SCA found that demand for accountability arose with particular force because of what was in issue in the review proceedings in the court below; and that secrecy is the very antithesis of accountability which prevents the public from knowing what decision was made, why it was made, and whether it was justifiable.

The SCA accordingly upheld the appeal with costs and the judgment of the Western Cape Division was set aside and replaced with an order dismissing SANRAL’s application with costs.  "

--- ends ---

Retirement benefits still intact for government employees

10 February 2015 By More Matshediso (BuaNews)

Pretoria - Acting Government Pensions Administration Agency (GPAA) Chief Operations Officer, Jay Morar, has set the record straight on pension fund rumours that have led to scores of resignations in the public sector.

“There is a rumour circulating that come the 1st of March 2015, GEPF [Government Employees Pension Fund] members will no longer be entitled to a lump sum. “Sadly, this state of affairs is still continuing unabated. I would like to categorically dismiss this assertion or rumour as a total lie,” said Morar on Tuesday.

In a media briefing in Pretoria, Morar said there has been a significant increase in the number of government employees, especially teachers, who resigned in the last financial year. Morar said the resignation trend among teachers increased following rumours that GEPF members will not get a lump sum when they retire due to pension reforms.

This is not the first time authorities have moved to put to bed pension fund rumours. Last year, Finance Minister Nhlanhla Nene urged South Africans to stop cashing in their provident fund savings when they resign or change jobs. He said rumours that retirement savings were under threat, due to plans to nationalise employee pension funds, were false.

Minister Nene said nationalisation rumours were false and that government’s plan to reform retirement savings was designed to ensure that members get to withdraw their retirement savings without fund managers, particularly trustees, subjecting them to exorbitant charges.

Teachers leading in resignations

Morar said the rumours that continue to circulate are misleading. The GPAA received the most resignations from teachers, followed by South African Police Service officials. Morar discouraged GEPF members from resigning, saying it deprives them of the well-deserved benefits earned over many years of public service.

“The GPAA has received an average of 2 239 resignation cases per month, on average receiving a total of 26 824 resignation cases per financial year,” said Morar. The highest number of resignation cases, approximately 4 600, from GEPF members was recorded in November 2014, which is slightly double the monthly average that GPAA received per month. 

Morar appealed to GEPF members to not opt for resigning, but to retire with GEPF to enjoy long-term benefits. He said most resignation cases showed that members were very close to retirement, and that it would have been better if they waited for retirement. “An average of 2 079 retirement cases are received by the GPAA each month, and a total of 24 948 retirement cases are received each financial year,” he said.

What happens at retirement?

Morar said all members of the GEPF will still be entitled to a lump sum when they retire, no matter when. He said the proposed pension reforms are aimed at harmonising pension fund and provident funds in South Africa.

However, Morar confirmed that National Treasury has decided to suspend the introduction of these pension reforms pending further discussions at the National Economic Development and Labour Council (Nedlac). “It is hoped that they might be reintroduced by the 1st of March 2016, provided an agreement is reached. Alternatively, the pension reforms will be introduced on the 1st of March 2017,” he said.

He urged GEPF members who are currently working to stop resigning because they are afraid they will lose their hard-earned money, especially their lump sum benefits.

I would like to appeal to GEPF members, most importantly teachers who seem to be the largest category affected by this misinformation, to approach the GPAA and seek clarity whenever they are in doubt before taking a life changing decision and resigning with less than two years to go before they reach their retirement age.”

Benefits

Morar said it is important that members retire with GEPF because pensioners are entitled to a lump sum when they retire, subject to the fund’s rules. He said all GEPF pensioners receive a monthly pension that is guaranteed for their entire life, also subject to the fund’s rules.

“GEPF pensioners are entitled to annual pension increases that are effective from the first of April every year, as determined by GEPF’s Board of Trustees,” he said. He also said that members who retire with GEPF are entitled to medical subsidy, subject to the pensioner having 15 years of service, being 50 years of age and older and being the principal member of medical aid for 12 months prior to their retirement.

Morar said another benefit for GEPF pensioners is that when a member retires, the first R500 000 is tax free; whereas when a member opts to resign, only the first R25 000 is tax free. - SAnews.gov.za

Over R456m of unclaimed benefits for government employees

10 February 2015 By More Matshediso of BuaNews

Pretoria - Acting Government Pensions Administration Agency (GPAA) Chief Operations Officer, Jay Morar, says there is about R456 million worth of unclaimed benefits for Government Employees Pension Fund (GEPF) members, as at December 2014.

Briefing media on Tuesday, Morar said the money translates into approximately 17 000 individual cases. “Provincial departments account for R271 million, while national departments account for R185 million… We (GPAA) are the first to admit that one untraceable case is too many and is giving us countless sleepless nights,” he said.

Morar said GPAA is faced with a challenge of unclaimed benefits, due to Bank rejections wherein GPAA is unable to rectify incorrect banking information as the client is untraceable. He said some of the challenges include cases that are submitted with incomplete documentation by departments; unclaimed funeral benefits; and other unclaimed benefits (as the member’s tax affairs are not in order, there are incomplete documents, disputes among others).

He said the majority of unclaimed benefits are in KwaZulu-Natal and most of them belong to poor or previously disadvantaged categories of people in rural areas, who do not know that they have benefits due to them, including their beneficiaries.

Tracing beneficiaries

Morar said GPAA has approached the Department of Home Affairs and credit bureaus to assist in tracing beneficiaries of unclaimed benefits. “We have embarked on a tracing initiative in which we have engaged the services of a tracing company. To this end, through this company, we have managed to record modest success,” he said.

He said GPAA staff members also conduct first-level tracing, which includes using the minimum information at their disposal to call anyone who might be related to the untraceable beneficiary. We have [also] started preliminary discussions with the Department of Public Service and Administration (DPSA) on how it can support and assist us in our tracing initiatives,” said Morar.

Increased accessibility

Morar said GPAA has been piloting the (modernisation) paperless project in the past two years, in which all documents are submitted electronically. “To date, modernisation has made substantial progress with our Business Payment Automation project during the year, particularly with eChannel, the electronic ‘post-box’ system for delivering exit documentation directly from employer departments to the GPAA,” he said.

Morar said GPAA is in a process of increasing satellite offices across the country, including in Venda, QwaQwa and Rustenburg. “More satellite offices will follow in the near future,” he said. - SAnews.gov.za

State of the Nation address (SONA)

12 February 2015 No mention of:

  • Failure to develop a comprehensive social security plan;
  • Failure with National Health Insurance;
  • Ratification and  implications of International Covenant on Economic, Social and Cultural Rights;
  • Continued unconstitutional (s34 of Bill of Rights) practices of Pension Funds Adjudicator, FAIS Ombud, FSB Appeal Board, FSB.

South Africa ratifies International Covenant on Economic, Social and Cultural Rights (ICESCR)

January 2015

South Africa has ratified the ICESCR, a treaty which gives legal effect to the socio-economic rights contained in the United Nations Declaration of Human Rights. Parliamentary ratification seems to have been via one committee (Justice) and then a resolution of Parliament. We have found no evidence of public participation. Bizarrely, the Justice Committee was told that there is only a “moral obligation” on South Africa to comply with ICESCR. Equally bizarre was the advice given to the committee that in any case ratification made no difference because South Africa’s constitution already is consistent with ICESCR. Apparently all government departments were consulted about ratifying ICESCR. The Covenant will enter into force for South Africa on 12 April 2015. See our separate analysis and review.

South Africa has already ratified the International Covenant on Civil and Political Rights, which gives legal effect to so-called blue rights/first generation rights, such as the right to have a dispute settled in the first instance in a fair public hearing by a competent, impartial tribunal. South Africa’s Constitution and jurisprudence gives effect to this. It almost goes without saying that National Treasury/Financial Services Board and the tribunals under their umbrella all ignore this and act unconstitutionally. See our separate analysis and review.

Ratification of Human Rights Treaty Reaffirms SA's Commitment to Socio-Economic Rights and Internationalism

On 12 January 2015, South Africa ratified the International Covenant on Economic, Social and Cultural Rights (ICESCR). Though ratification is long overdue, given that President Nelson Mandela signed the Covenant in 1994, this statement of renewed commitment to social and economic justice and internationalism has been roundly and justifiably welcomed.

But what is the significance of this moment? To answer that, we must briefly revisit a very different time.

1976 was a year of tragedy and shame for South Africa. Internationally, it also marked a turning point. The mass student protests against the introduction of Afrikaans as the medium of instruction in schools - a continuation of struggles that had been waging ever since the Bantu Education Act was passed in 1953 - had the Nationalist government on the back foot. On 16 June it showed its teeth. The tragic onslaught by security forces against unarmed youth led to the deaths of 176 learners in Soweto and thousands of casualties across the country.

While the Soweto Uprising shocked the nation, the dramatic escalation in violence meted out by the Apartheid regime also led to new levels of international condemnation of South Africa, pushing the country further into its pariah status as ‘the skunk of the world’. Within a month of the Uprising, on 18 July 1976, the International Convention on the Suppression and Punishment of the Crime of Apartheid came into force. Perhaps even more symbolic, the UN General Assembly agreed to invite representatives of the South African liberation movements to speak in a special plenary meeting of the Assembly. On 26 October, ANC President Oliver Tambo became the first non-white South African to take the famous UN podium. His speech addressed the world ‘in the name of the African National Congress and the entire liberation movement in South Africa, and especially, on behalf of the oppressed people of South Africa, including their children, the current victims of murderous repression.’

Earlier the same year, the ICESCR entered into force. This binding international treaty established economic and social rights in international law for the first time. The ICESCR affirmed the principle that ‘freedom from fear and want can only be achieved if conditions are created whereby everyone may enjoy his economic, social and cultural rights, as well as his civil and political rights.”

By 1994, much had changed, both within and beyond South Africa’s borders. Less than six months after assuming the Presidency, Nelson Mandela arrived in New York to sign the ICESCR. In 1996, a new Constitution for the Republic was enacted providing for justiciable socio-economic rights (SERs).  The public’s belief in the new Constitution, and the government’s commitment to promoting and defending it, might explain the initial delays in not ratifying the ICESCR immediately. South Africa’s experiment in democracy had just begun and the country could be forgiven for grasping the opportunity to chart its own constitutional course. However, by the late 2000’s, a civil society campaign was formed to push for the ratification of the ICESCR.

Finally, it got its wish. On 12 April 2015 the ICESCR will enter into force in South Africa. So what does this mean?

In short: it provides new opportunities for the state and civil society alike to explore what social and economic justice requires of us today. Ratification of the ICESCR, which binds South Africa to its provisions, brings new opportunities for ordinary citizens (such as through the reporting procedure) to shape and accelerate dialogue and actions towards the realisation of social and economic rights.

For example, while most of the rights in the ICESCR find recognition in the SA Constitution (including the rights to food, housing, health care and education), the Covenant recognises one new right, and sets at least two new, arguably, more progressive standards or principles for socio-economic rights fulfilment, both of which have implications for the obligations on the state.

“The Right to Work” (article 6) is a new right, which could have important implications for the 15 million unemployed South African’s. Another interesting provision is Article 11: “the right to an adequate standard of living”. This right could be interpreted as giving legal force to the National Development Programme’s commitment to ensure a Decent Living Level for all. In relation to “social security”, the UN Committee on Economic, Social and Cultural Rights has also arguably favoured a more expansive approach, which could have an impact on governments policy not to provide comprehensive social security or long-term social insurance to adults aged 19-59.

Justifiable worries have been expressed about the decision to make a declaration on the right to education, which, in the absence of any official statement by the state, has been taken as an attempt to undermine the more progressive right to basic education contained in the Constitution. Anyone familiar with our Supreme Law, however, will know that the right to basic education is immediately realisable in South Africa and not subject to progressive realisation within available resources. The Constitutional Court has affirmed this and no declaration on the part of the state will change that.

Of course, as the millions of South Africans for whom the notion of socio-economic rights remains a rather distant concept know, having rights on paper does not automatically translate into enjoyment of rights on the ground. To be enjoyed and experienced by the majority of South Africans, the rights in the ICESCR, like the rights in the Constitution, will have to be fought for before they become real.

The ICESCR is a pro-poor treaty that sets important principles and standards for how government should apply itself, and provides a normative rights-based framework for how a socially and economically just society might look. However, without social awareness and mobilisation around the rights in the treaty, its impact will be diminished. Civil society has an important role in ensuring that this is not the case.

Ratification of the ICESCR should be seen as a reaffirmation by the government of the transformative principles at the heart of the Constitution, and to the proud history of internationalism, which the ANC and many of our other liberation movements have.

Reflecting on learners’ struggles for the right to education and on the broader goals of those fighting for freedom in South Africa, at his inaugural address to the UN General Assembly in 1976, Tambo said: “We fight to transfer political power into the hands of the people. When, in June and in subsequent months, our people replied to the fascist power with the cry "Amandla ngawethu”, they meant "Power to the people”. It is with that power that the people will transform our country into an acceptable member of the international community and create within it a society that upholds civilized and humane standards.”

This year, a new tool has been added to the armoury in the fight against poverty, inequality and unemployment, a tool whose implementation would go some way to reclaiming South Africa’s place at the forefront of international struggles for the promotion and protection of all human rights. The question is how will we use it?

McLaren is Socio-Economic Rights Project Leader at the Studies in Poverty and Inequality Institute in Johannesburg.

Source: The South African Civil Society Information Service

Socio Economic Research Institute welcomes SA government’s ratification of ICESCR

Statement 19 January 2015

SERI is delighted by yesterday’s ratification by the South African government of the International Covenant on Economic, Social and Cultural Rights (ICESCR), which will enter into force on 12 April 2015. The South African government signed the ICESCR twenty years ago and while it has taken its time to ratify the ICESCR, it is an important step forward that the ICESCR will now have greater force.

SERI looks forward to the government’s speedy ratification of, or accession to, the Optional Protocol to the ICESCR (OP-ICESCR) – an action that will consolidate South Africa's role in advancing the rights of poor people around the world to a decent standard of living.

The OP-ICESCR is an additional treaty that provides an individual complaint mechanism (such as exists for the other major international human rights treaties, including the International Covenant on Civil and Political Rights). This mechanism further promotes a culture of accountability for implementing the ICESCR. It empowers vulnerable and marginalised groups to lodge individual complaints at the international level regarding violations of their socio-economic rights.

Contact details:

Jackie Dugard, senior researcher at SERI: jackie@seri-sa.org / 084 240 6187


Human Rights Commission welcomes ratification of International Covenant on Economic, Social and Cultural Rights

18 Jan 2015

The South African Human Rights Commission welcomes the decision by the South African government to ratify the United Nations International Covenant on Economic, Social and Cultural Rights (ICESCR).

The decision by government, which was effected this past week, on the 12th January 2015, should be commended as it ensures that South Africa is finally able to honour its international obligations and to consolidate its commitment to alleviate poverty and ensure social justice for all.

In the statement of Declaration after the ratification this week, the United Nations expressed its hope that by ratifying the ICESCR, “the Government of the Republic of South Africa will give progressive effect to the right to education, as provided for in Article 13 (2) (a) and Article 14, within the framework of its National Education Policy and available resources.”

The Commission believes that the ratification will enhance the ability of the government to play a meaningful role as one of the key advocates for social, economic and cultural rights in the international arena. And it will  further enable the Country to keep pace with those countries that have ratified the Covenant and thus accelerate and improve the respect and observance of socio economic rights in South Africa.

It is for this reason therefore that as the Commission we urge Government to expedite the domestication of the Covenant so as to ensure that those provisions that are in the Covenant and not in our Constitution, or any other legislation, become applicable in South Africa.

The final ratification of this Covenant is a fitting tribute to former President Nelson Mandela who initially signed the ICESCR in 1994 on his first visit to the UN in New York, taking a bold step to indicate South Africa’s intention to join the rest of the world in promoting socio-economic rights.

SA Govt's declaration on education clause mars the welcome ratification of the International Covenant On Economic, Social And Cultural Rights (ICESCR)

Wednesday, 21 January 2015 www.equaleducation.org.za

As South African organisations working to advance the rights to education, dignity and equality, we welcome our government’s ratification of the International Covenant on Economic, Social and Cultural Rights (ICESCR). But we are dismayed by the qualification made in respect of the right to education, which detracts from what is otherwise a moment to celebrate.

On 12 January 2015 the South African government ratified the ICESCR, more than twenty years after signing it. The ratification is set to enter into force on 12 April 2015. The ICESCR is an international human rights treaty of the United Nations (UN). It establishes an international framework for the protection and realization, by state parties, of socio-economic rights such as the rights to food, housing, healthcare and education. State parties that have ratified the ICESCR have a legal obligation to work towards the realisation of the socio-economic rights set out in the ICESCR. South Africa is the 163rd state party to this treaty.

We, as organisations working to ensure the realisation of learners’ rights to a basic education in terms of Section 29(1)(a) of the Constitution note with deep concern South Africa’s declaration in respect of the ratification process.  This declaration states that:

‘The Government of the Republic of South will give progressive effect to the right to education, as provided for in Article 13 (2)(a) and Article 14, within the framework of its National Education Policy and available resources.’

 This declaration signifies a deliberate intention by the South African government to misinterpret the right to basic education as enshrined in our Constitution. This is an attempt to qualify the unqualified nature of the right to basic education as set out in Section 29(1)(a) of the Constitution, the unqualified nature of which has been confirmed by the South African Constitutional Court in the case of Juma Musjid. In the judgment, Justice Nkabinde stated:

 ‘It is important, for the purpose of this judgment, to understand the nature of the right to “a basic education” under section 29(1)(a). Unlike some of the other socio-economic rights, this right is immediately realisable. There is no internal limitation requiring that the right be “progressively realised” within “available resources” subject to “reasonable legislative measures”.’

The declaration made by the SA government to qualify its ratification of the ICESCR is therefore a deliberate attempt to insert “progressive realization” and “available resources” qualifications into the right, qualifications which the Constitutional Court has expressly rejected in its binding interpretation of the Constitution. The SA government’s declaration also seeks to constrict this constitutional right “within the framework of its National Education Policy”. However the policy should be drawn up to comply with the constitutional right, not the other way around. The declaration therefore undermines the Constitution.

 The state of education across the country continues to be unequal and learners in township and rural schools continue to learn in harsh conditions. As was noted in a recent op-ed by Nic Spaull in the Sunday Times:  “For each 100 pupils who started school in 2003, only 48 wrote matric in 2014.  Of these, 36 passed and 14 qualified to go to university.”

It is within this context that we express our support for the ratification of the Covenant and our disappointment at the South African government’s attempt to water down its commitment to ensure access to quality and equal education for all learners.

 Nevertheless the ratification is still an important step forward for the protection and advancement of a wide range of socio-economic rights.


FW De Klerk Foundation welcomes South Africa's ratification of International Covenant on Economic, Social and Cultural Rights 

Statement issued by the FW de Klerk Foundation

The FW de Klerk Foundation welcomes the decision by government to ratify the International Covenant on Economic, Social and Cultural Rights (ICESCR), which commits parties to ensuring these rights.

Together with the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights and two Optional Protocols, the ICESCR forms a constituting part of the International Bill of Human Rights. The ratification takes place 21 years after President Mandela first signed the ICESCR, commencing South Africa’s journey towards promoting and protecting the economic, social and cultural rights of its people.

The ratification follows a protracted struggle by South African human rights groups, who have for years called on government to ratify and incorporate the ICESCR. These calls were answered on 10 October 2012, when Cabinet agreed to South Africa’s planned ratification. South Africa finally deposited its instrument of ratification with the United Nations on 12 January 2015. South Africa did, however, ratify the Covenant with the declaration that the country “will give progressive effect to the right to education, as provided for in Article 13(2)(a) and Article 14, within the framework of its National Education Policy and available resources.” South Africa must now incorporate and domesticate the ICESCR (which will enter into force for South Africa on 12 April 2015) - especially those provisions of the ICESCR not already provided for in the Constitution and other legislation.

Most of the rights in the Covenant are already included in the South African Bill of Rights.  However, the following provisions that might be of special interest to South Africa:

Article 2.2 “The States Parties to the present Covenant undertake to guarantee that the rights enunciated in the present Covenant will be exercised without discrimination of any kind as to race, colour, sex, language, religion, political or other opinion, national or social origin, property, birth or other status.” (Some aspects of government policy relating to affirmative action and demographic representivity might be inconsistent with this requirement.)

Article 6.1 “The States Parties to the present Covenant recognise the right to work, which includes the right of everyone to the opportunity to gain his living by work which he freely chooses or accepts, and will take appropriate steps to safeguard this right.” (The South African Bill of Rights does not include any provision that specifically recognises the right to work.)

Article 7(ii)(c) “The States Parties to the present Covenant recognise the right of everyone to the enjoyment of just and favourable conditions of work...” including: “(c) Equal opportunity for everyone to be promoted in his employment to an appropriate higher level, subject to no considerations other than those of seniority and competence;” (Some of the government’s affirmative action policies requiring race quotas and demographic representivity might be irreconcilable with this provision.)

Article 9 “The States Parties to the present Covenant recognise the right of everyone to social security, including social insurance.” (The government does not yet provide comprehensive social security or social insurance.)

Article 11.1 “The States Parties to the present Covenant recognize the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions.” (This right is not explicitly included in the South African Bill of Rights.)

The government’s decision has been commended by the South African Human Rights Commission (SAHRC), who said that “it ensures that South Africa is finally able to honour its international obligations and to consolidate its commitment to alleviate poverty and ensure justice for all”.

The FW de Klerk Foundation joins the SAHRC in expressing hope that the ratification will ensure and advance the protection, promotion and realisation of social, economic and cultural rights of everyone in South Africa.

Would you pay Dube Tshidi R5million? Would you employ him at all?

“The Chairperson felt that the matter of the Chief Executive Officer (CEO) of the Financial Services Board (FSB,) who was reported to be earning R5 million per annum, should be considered further by National Treasury. Members mandated him to raise this with the Minister of Finance.” Standing Committee of Finance 27 November 2015 (as per PMG)

National Treasury has a change of heart about preservation, and still no comprehensive national social security plan

“Social security” remains a dirty term for National Treasury who continue to studiously avoid mentioning it, while pretending that itsy bitsy changes constitute reform. Its a bit like boer soek 'n vrou maar sé niks van seks nie ... en die enigste pomp is 'n windmeul.

National Treasury provided the Standing Committee of Finance with an update on its thinking on pensions reform, plus Twin Peaks, on 25 November 2014. Should you wish us to email either or both, please let me know.

These are the titles of their presentations:

Retirement Reform in South Africa An Overview and Update from the National Treasury Presentation to the Standing Committee on Finance 25 November 2014

Twin Peaks Model of Financial Reform Creating a Safer Financial Sector to Serve South Africa Better National Treasury | November 2014

Regards

Mike Thurtell

Pension funds – a social security mechanism?

E B Monitor No 348: Most of our readers will be very familiar and probably sick to death of the various documents that have flown around about social security. In this E B Monitor we simply consolidate our old snippets as a memory jogger. It starts with bullet points history of social security in South Africa. It ends with international law and its impact locally, especially in view of the probable ratification of an international treaty on social security. Any retirement fund practitioner worth his/her salt will want to start getting to grips with this topic.

We hope that the information, insights and views will help you form your own opinions. We do understand that what we have to say is a lone voice in the wilderness, different from regulatory and industry assumptions. However, we have done enormous research and attempted not to jump to conclusions too quickly, yet looking at old matters afresh through the prism of constitutional principles. We are satisfied that the principles are sound, grounded in jurisprudence. It’s the hitherto lack of application of the law to employee benefit arrangements that some might find unappetising.

Should you wish to correspond on any matter raised herein, or simply hurl abuse, please contact me.


PAJA, PAIA and disclosure by pension funds: Why the FSB is dangerously wrong

E B Monitor No. 347: Our previous issues of The E B Monitor looked at PAJA. By definition, this included the topic of public power.  The Constitution provides the framework for governance in South Africa and regulates the exercise of public power in other areas as well. Any discussion of governance of retirement funds therefore starts with identifying areas of exercising public power and legal implications. In this E B Monitor we look at the right to information angle of PAJA and the right to adequate reasons and what this means. We also look at how this links to any communication/disclosure policy of pension funds, which are subject to PAIA (Promotion of Access to Information Act. We note that pension funds, if understood to exercise public powers, are public bodies under PAIA. This involves substantial obligatory disclosure of information. We note that the right to adequate reasons provisions of PAJA override the provisions of PAIA allowing refusal of information. We note that even where PAIA allows a refusal of disclosure, that is often discretionary (“may”) and that a refusal to disclose may often be reviewable. We note and comment on the different approach of secrecy of the FSB, as set out by it in its communications and Trustee Toolkit. We note that contrary to what the FSB says, minutes are not automatically secret and that the PAIA overrides the Pension Funds Act, 1956. We note that complying with the FSB’s requirements and training, may lead to trustees acting unlawfully. We also note that a public body under PAIA is also an organ of state under the Constitution with specific constitutional responsibilities attached to such status. We then note that the rule of law attaches to the exercise of public power and provide summaries of two elements of the rule of law, lawfulness and rationality. Another element, vagueness and the need for certain/clear legislation, was discussed in our discussion about the problems caused by inadequate alignment of the Pension Funds Act, 1956, with PAJA, so is not repeated here, but similar comments apply to the lack of alignment to PAIA and the Constitution.

Finally, we play devil’s advocate and note that some judges do not see pension funds as having a public role, and that they seem completely unaware of the role of pension funds in social security models. We note that given that there is no national social security plan, and apparently no intention to have one, and that Treasury has decided to develop its plan with a foreigner on a piecemeal basis, it is quite conceivable that the Constitutional Court could decide that we are all fooling ourselves, as well as the Supreme Court of Appeal for thinking that pension funds are in the public interest.



Parliament

(10 November 2014)The National Assembly will hold a debate on an effective health care system: “Continuing in our collective path to ensure a comprehensive healthcare system in South Africa”, on 20 November 2014. Almost needless to say, there is no such debate on the overdue promised comprehensive social security system. It is interesting that they can debate a healthcare system, without the broader social security system. Trevor Manuel failed to deliver. Gordhan failed to deliver. Nene failed to deliver. All rated themselves highly.

More nenepoop

(24 October 2014) We were told that there is social security reform. Now (MTBF) Nene says retirement fund reform is being discussed at Nedlac. Does he know what's going on?

Fettering discretion

(23 October 2014) Fettering of discretion is a ground of review under PAJA, although, like review of discretion based on material mistake of fact, it is not explicit. Strangely enough, it is also a separate sui generis ground of review for breach of fiduciary duties. In the most recent update to Employee Benefits Monitor No. 344 we look at a few relevant cases, in view of the reviewable exercise of discretion by pension funds. We also identify a few principles from judgments which determine how policy guidelines may be developed and use. [email: ebmonitorcoza@gmail.com]

Public Protector report shows systemic contraventions of PAJA by National Treasury and South Africa’s largest pension fund

16 October 2014 … five years later not much seems to have changed, it seems from another report by the Public Protector. Yet the GEPF claims that it complies with the law and wants to be a role model.

Good governance and ethical behaviour provide the foundation for GEPF to realise its aspiration to be a role model for pension funds worldwide.

GEPF complies with the requirements of the Government Employees Pension Law (GEP Law) and the rules of the Fund, but also looks to the Pension Fund Act for best practice where the two are not in conflict. GEPF is committed to transparency, integrity and accountability based on accepted corporate governance principles and practices.”

It’s a bit sad that the Pension Funds Act, 1956, comprehensively ignoring the Constitution and legislation such as PAIA and PAJA, should be looked at for best practice.

Employee Benefits Monitor No. 340 summarised the applicability of PAJA in the regulatory spheres and funds in regard to retirement funds, as explored in E B Monitor Nos. 3, 4 and 6. Annexure 6 (E B Monitor No. 344) has now been updated to take into account examples of PAJA’s effect on GEPF, as shown by Public Protector reports and High and Supreme Court of Appeal judgments.[email: ebmonitorcoza@gmail.com]

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Draft Taxation Laws Amendments Bill, 2014 and Tax Administration Laws Amendment Bill, 2014

15 October 2014

If any subscriber would like the PowerPoint presentation and Draft Response Document from National Treasury and SARS, as presented to SCOF, please let me know and I’ll email it to you. They contain responses to feedback and secret consultations on matters such as the ad-hoc non-reform retirement fund "reforms", while the "reform" white paper is awaited, although some of the Department of Social Development's proposals for integrated social security have already been rejected by Cabinet, according to their annual report.

What a crock of nene. [email: ebmonitorcoza@gmail.com]

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(14 October 2014) Employee Benefits Monitor No. 350: Amendment to penalties and offences regarding the Pension Funds Act, 1956: Section 43 of The Financial Services Laws General Amendment Act, no. 45 of 2013 has amended the “Offences and penalties” section of the Pension Funds Act, 1956 applicable to the Pension Funds Adjudicator, by:

(a)  stipulating a ceiling of the monetary penalty, to R1m, and

(b)  increasing imprisonment from three months to twelve months, and

(c)  instead of it being a fine or imprisonment, it may be both.

But is it Constitutional? In this issue we look at the issue of penalties for insulting the Pension Funds Adjudicator, through the lens of the Constitution. In addition to noting the amendment (page 1) we look at what the following have to say:

(a) The Bill of Rights’ provision for freedom of expression.

(b) The Constitutional Court and The Supreme Court of Appeal about open justice and the requirement for courts, tribunals and other fora to hold fair public hearings in terms of section 34 of the Constitution and the International Covenant on Civil and Political rights of 1996 (ICCPR), with its interpretive General Comment No. 32

(c) The Constitutional Court and The Supreme Court of Appeal on acceptable and needed criticism of the judiciary and tribunals.

(d) The defence of protected comment. [email: ebmonitorcoza@gmail.com]

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(8 October 2014) To PAJA or not to PAJA?

National Treasury/FSB/Parliament's view, insofar as the Pension Funds Act is concerned, is that PAJA applies in very few circumstances only. Those few circumstances are a limited number of acts of the Registrar of Pension Funds. None apply to acts of trustees and other functionaries like curators, liquidators, principal officers and the Pension Funds Adjudicator ... or so they say.

Employee Benefits Monitor No. 340 dispels those myths. We show that what the Registrar failed to disclose were actual cases of PAJA reviews of his actions. How does one forget the litigation one is involved in? We then note examples of approximately 50 subjective discretionary powers that he has, that are subject to PAJA review.

Annexures 3, 4 and 5 (E B Monitor Nos. 343, 344 and 346 provide supporting reviews of relevant cases, judgments and articles) regarding medical schemes, pension funds and the Registrar of Pension funds.

Due to their prolific non-compliance with section 34 of the Constitution (and therefore PAJA as well), we look at administrative tribunals in the next series of issues of The Employee Benefits Monitor. These tribunals include the Pension Funds Adjudicator, Enforcement Committee, FSB Appeal Board and FAIS Ombud. We also look at administrative sanctions where FSB/National Treasury/Parliament attempt to circumvent section 34 of the Constitution.

Mike Thurtell

(1ebmonitorcoza@gmail.com2 without the 1 and 2, to avoid spam)

P.S. PAJA = Promotion of Administrative Justice Act

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Composition of the Constitutional Court in the fourth term of 2014

Justice Monica Leeuw, Judge President of the North West Division of the High Court has been appointed since 1 August 2014 as an Acting Justice of the Constitutional Court in the vacancy left by the retirement of Justice Thembile Skweyiya.  She will continue to act until 31 December 2014.  Justice Chris Jafta will be on long leave from 1 November 2014 to 31 March 2015.  Justice Zukisa Tshiqi of the Supreme Court of Appeal has been appointed as an Acting Justice of the Constitutional Court in his stead during this period.

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Horn back in court to fight for additional benefits (Horn v LA Health) Constitutional Court Roll- 4th Term (2014) 

11 November 2014 (Tuesday)  Johannes Petrus Louw Horn and Others versus LA Health Medical Scheme and Others CCT 97/14

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Disciplined financial planner appeals to Supreme Court of Appeal

Elizabeth Coetzee v Financial Planning Institute of South Africa & others (1079/2013)

Appealed from WCC - Date to be heard: 12 November 2014 - Lewis JA, Leach JA, Saldulker JA, Swain JA, Mocumie AJA

Review of the finding of a professional Appeal Tribunal – appellant carries on business as a provider of financial services – first respondent is a voluntary association of financial service providers, with its own code of conduct and discipline – the other respondents are members of an appeal tribunal of the first respondent – appellant provided advice to a Mrs Wagener in respect of the investment of proceeds of a sale of shares – R30 000 000 – first respondent subsequently received a complaint from Mrs Wagener about services rendered by appellant – disciplinary proceedings against appellant – first respondent‟s disciplinary committee found appellant guilty on a number of charges and imposed certain sanctions – appeal to appeal tribunal which overturned findings of the disciplinary committee but found that advice given was so poor that it did not merit the amount of the commission and found appellant guilty of failing to exercise reasonable and prudent professional judgment and furthermore failed to have acted in the interest of the complainant in that she failed to execute the mandate of the complainant properly, diligently and professionally – unsuccessful review by appellant in high court of appeal tribunal‟s findings – whether appellant had received a fair hearing on the one point that the appeal tribunal found her guilty – appellant contends that the hearing was unfair as she was found guilty on a count that had not been put to her and against which she had not been given an opportunity to defend herself. [email: ebmonitorcoza@gmail.com]

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South African Local Authorities Pension Fund v Msunduzi Municipality (994/2013)

Appealed from KZP - Date to be heard: 20 November 2014 - Maya JA, Bosielo JA, Wallis JA, Saldulker JA, Meyer AJA

Pension Fund/Increase in employer contributions appellant instituted action against the respondent, claiming in terms of the provisions of the Pension Fund Act 24 of 1956, certain additional contributions it alleges are due – high court granted absolution from the instance – whether respondent bound by an amendment to the rule increasing employers contributions – whether amendment valid. [email: ebmonitorcoza@gmail.com]

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