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Implementation of the Special Pensions Act. (As Amended)
UPDATE TO PORTFOLIO COMMITTEE ON FINANCE
8 August 2007
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Purpose
To provide the Committee with an overview on the implementation of the Special Pensions Act (Act 69 of 1996)
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Background
The Act was promulgated in 1996 to give effect to section 189 of the interim constitution, “to make provision for a Special Pension to persons who made sacrifices or served the public interest in the establishment of a democratic constitutional order”
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Qualification Criteria(As set out in the Act) Had to be 35 years or older on 1 December 1996. South African citizenship or entitlement to SA
citizenship Full time service in a political organisation which
was restricted or declared unlawful. Banishment or restriction. Imprisonment or detention for an offence with a
political objective. Inability to build a pension for at least 5 years.
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AMENDMENTS
Overtime amendments were proposed.
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Summary of Amendments
1998: Benefits extended to persons suffering of
terminal diseases. Payment advanced to date on which person
becomes 35. Benefits paid to members of the legislature.
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Summary of Amendments
2003 (Act 21) Condonation of late applications Dissolution of the Board Remove requirement that 1 Review Board
Member had to be an actuary.2003(Act 30) Non Statutory Forces (NSF) option
introduced. Ceasing of Special Pension if pensioner opts for “NSF” option.
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Summary of Amendments
2005 (Act 28) Lapsing of the rights to Special Pensions
and survivor’s benefits on 31 December 2006.
Provision of monthly pensions for surviving spouses and orphans of pensioners (retrospective), as well as a funeral benefit (not retrospective).
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Summary of Amendments
Reconsideration of cases already adjudicated on the basis of material new facts.
Re-enforcing provision for recovery of benefits paid to a person that was not entitled to that benefit.
Dissolution of the Board and Review Board.
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Implementation of Act (as amended)
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Lapsing Of Rights To Benefits On 31 Dec 2006.
Embarked on extensive Communication and Awareness campaign. Road shows in all provinces Regional visits 2 million newsletters distributed (inserts in major
newspapers) Briefed political organisations.
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Awareness Campaign
Radio Adverts SAFM Lesedi Ligwalagwala Ukhozi Mhlobo Wenene
Newspaper adverts City Press Sowetan Sunday World
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Newsletter Inserts
City Press Indabazethu Umtata Herald Ilizwi Daily Dispatch EP Herald Sowetan Daily sun Tshwane Sun Isoloezwe
Ilanga The Rising Sun Lentswe Capricorn Voice Northern Review Mpumalanga News The Echo VUKANI Plainsman Free State Issue
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Statistical Overview
Rec’d Approved Not Approved
Out
standing
Applications received by 31 December 2006
46 148 15 674
(34%)
21 762
(47%)
8 712
(19%)
Applications received by end of 1998
12 900 2 380 91 10 519
Review applications 6 748 834
(12%)
3 286
(49%)
2 628
(39%)
Section 7 (2)
(New material facts)
161 52
(32%)
33
(21%)
76
(47%)
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Statistical Overview
Rec’d Approved Not Approved
Out
standing
Spouses pensions 295 226 31 38
Orphans 9 2 4 3
Funeral benefits 234 186 16 32
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Financial Overview
Benefits Paid Operational Expenses
R2.01 billion R86,4 million
(4.3 %)
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Dissolution of Board
Board Dissolved on 28 February 2007 as per Act.
Powers of Board devolved to Director General.
Additional capacity will be added to fast track adjudication process.
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Common Reasons for Non Approval(Risk factors)• Does not meet the minimum age requirement
• Does not meet the minimum service requirement (5 years)
• Does not have full-time service in a previously banned political organisation
• Committed a criminal offence after 2 February 1990
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Common Reasons for Non Approval• Was actively engaged in actions to undermine
efforts to establish a non-racial democratic constitutional order.
• Does not meet the definition of a surviving dependant.
• Does not meet the definition of disability.
• Political Party could not verify the service claimed.
• Insufficient information to support the claim.
• Suspicions of fraud.
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Members of the Board
1996 – 1998 Ms. N Moletsane Ms. S Masote Mr. T Shange Ms. B Maree Rev. D White
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Members of the Board
1998 – 2000 Mr. I Makopo Mr. E Mohammed Ms. V Petersen Mr. J Njeke Ms. U Bhoola
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Members of the Board
2001 – 2002 Mr. I Makopo Mr. ZI Mthimunye Mr. SE Thokoane Mr. CAS Setsubi Ms. RW Ncame
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Members of the Board
2002 - 2003 Mr. I Makopo Mr. ZI Mthimunye Mr. SE Thokoane Ms. RW Ncame Mr. Moloi
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Members of the Board
2003 - 2007 Mr. I Makopo Mr. ZI Mthimunye Mr. SE Thokoane Ms. RW Ncame
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Members of the Review Board (3) Adv. Z Barmania Mr. M Matsobane Prof. A Asher (Actuary) Mr. ML Moloi Adv. Mokoditoa Mr. W Dam (Actuary) Mr. P Burra (Actuary) Mr. M Walker (Actuary)
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Adjudication Process
Files pre-screened and prepared by File Preparation Unit.
Files examined by adjudication unit within SP Admin.
Recommendation submitted to delegated authority for approval.
Takes approximately 90 to 120 days to finalise an application.
Common cause for delays – missing documentation and verification process.
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RECORDS MANAGEMENT
Process incoming mail
New application?
Stamp and capture
application on CIVPEN
Existing file?
Open file and store application
Retrieve file and put application in
the file
More info needed?
Send file to File Preparation Unit
Send a letter to the applicant
Put a copy in the file
More info needed?
Receive file from other units
Identify documentDocument identified?
Identify the source address of the
document
Source address
identified?
Retrieve file from Filing Room
Put document in file
Update record if necessary
Put the document in unidentified Arch-lever file
NO
Send to Client Liaison
NO
YESSend file to
relevant SP unit
Send Board decision letter to
the applicantNO
YES
NO
YES
NO
YES
NO
YES
NO
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Receive file from Registry / Review
Board
Screen the documents on file
FILE PREPARATION UNIT
More info?
Complete pre-adjudication
summary and put it on file
Verify political service?
YES YES
NO
Send file to Board/Review Board
Research info req’d?
NO
Obtain political verification
YES
NO
Conduct required research
Make recommendation and send file to Board /
Review Board
Claim approved by
Board / Review Board
YESSend file to Payments
NOBoard returns file
to Registry
Note: Gauteng Political Verifiers & Research Unit have been absorbed into this unit
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PAYMENTS ADMINISTRATION
Receive file from Board / Review Board
Generate/Authorise/Confirm
payment
Benefits Admin supplies verification on spouses/
dependants/funeral benefits prior to payment
Return file to File Preparation Unit
More info needed?
Application approved?
YES
Send file to Client Liaison to generate letter to applicant
NO
NO YES
Write letter of approval including payment details to
applicant
Write approved file details on statistics
registerPlace copy of approval on
applicant’s file
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BENEFITS ADMINISTRATION
Receive file from Registry
Conduct verification on
req’d documents
Verify approval for payments on spouses/
dependants/funeral benefits
Payment approved?
NO
YES
Notify applicant by means of a letter explaining claim
not approved.Also notify applicant that he/she may appeal and include necessary form.
Return file to Registry
Send file to Payments Admin
to action payment(s)
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CLIENT LIAISON & EVENT MANAGEMENT
Receive file from Registry
Receive Ministerial enquiry from CEO
Respond to general client correspondence
Attach copy of signed response letter to
enquiry
Place correspondence copy on file
Request file from Registry
Compose a response to the client referred to in
the letter
Put copy in the file, after mailing original
letter
Place signed letter in an envelope
Provide copy of response client letter to GEPF Communications
(Lesna Sewnarain)
Send envelope off for mailing
Return file to Registry
Return file to Registry
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Dissolution of Review Board
Review Board dissolved with effect 29 May 2007 as per the Act.
Functions of the Review Board devolves to the Minister of Finance.
The Minister will obtain advice from persons with appropriate political and legal experience.
The Minister will institute special measures to ensure that all backlogs are addressed.
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Matters Under Consideration.1. To amend the schedule of benefits to
increase pension when pensioner reaches the age of 65.
2. To consider the payment of a monthly pension to the surviving spouses of persons who died before the Act was promulgated.
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Age Qualification Criteria (Under 35’s) Extract from PCOF report adopted by the
National Assembly on 8 November 2005.
“The Committee recognizes that there are potential beneficiaries who have met all, except the age criteria. … the Committee has resolved that the Executive should urgently develop other measures to address the plight of those excluded purely on the basis of age …”
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Age Qualification Criteria (Under 35’s) PCOF report of 16 November 2006.
“That the House request the Leader of Government Business to provide feedback on the adoption of the Resolution with particular reference to co-ordinating the implementation of programmes which will provide education, skills and other measures”
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Age Qualification Criteria (Under 35’s) Treasury remains committed to participate in
any initiatives towards implementing these resolutions.
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Irregularities in Implementation of the Act. A desk top study commissioned by Treasury
suggested irregularities and evidence of fraudulent activity e.g. Persons who had committed schedule 1 offences
were not removed from the system. False biographies were submitted. False claims by dependants and spouses.
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Irregularities in Implementation of the Act. Treasury engaged the services of the Special
Investigating Unit.
The investigation commenced in January 2007 and is scheduled to be completed by July 2008.
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Key Challenges
• To streamline the Adjudication and Review process so that we can finalise all outstanding applications within 18 months.
• Verifying information provided by applicants.