The Department of Mineral Resources, led by the Deputy Minister, briefed the Committee on the political interventions on the mine lung diseases and silicosis class action cases.
The Deputy Minister said South Africa was a strong mining country, but mining had also been damaging to the environment and had left people sick. It was for this reason that the legal fraternity had taken the negative aspects forward. Where the state crossed paths with the legal fraternity was when they “mined” the mine workers. Most mine workers did not receive the compensation they deserved after compensation had been paid out. The lawyers and the doctors were making a lot of money, especially in class action cases. The Committee and the state had to check who the beneficiaries of the class actions were. This was a serious issue. It should not be a question of what the Department was doing alone, but what Parliament was doing. The government was watching the outcome of the class action to determine how to finalise the plight of the ex-miners who were not able to get what was due to them. The incidence of tuberculosis was very high in the country, and mining was where it was concentrated.
Members asked how much had been set aside by the government for the 106 000 outstanding claims, and wanted more clarity on the position of controlled and uncontrolled mines. What steps were being taken to harmonise laws on lung diseases? Did lawyers for the mineworkers collect more than just contingency fees? What steps had been taken to harmonise the laws on lung diseases? Many workers had died from these diseases since the class action began -- would their beneficiaries benefit from the trust fund? If a worker decided to opt out from the settlement, what were the prospects of getting a better deal? What were the plans of government to deliver a compensation system that functioned to the advantage of the mine workers?
The Committee was supposed to engage with the Minister of Mineral Resources on the process to follow in connection with allegations of state capture. However, correspondence had been received from the Minister’s office which stated he was still recovering from illness. While a DA Member objected to the apology, saying it was “the oldest trick in the book,” the Committee agreed to ask the Minister to make himself available at the Committee’s first meeting in 2018.
State capture: Minister not available
The Chairperson said that the Committee had been supposed to deal yesterday with questions to the Minister so that it could finalise matters and deal with the way forward. The Minister had declared his unavailability, with reasons, and the meeting had therefore been shifted till today. The Chairperson asked the Secretary to read out the reason for the unavailability of the Minister at today’s meeting.
The Secretary said correspondence from the Minister’s office stated the Minister was still recovering from illness.
The Chairperson opened the floor for Members to deliberate on the apology of the Minister.
Mr H Schimdt (DA) said it was unfortunate that the Minister was not present, saying it was “the oldest trick in the book” to say one was ill. He objected to the apology. He suggested that the Committee determine a date in two weeks’ time and ask the Minister if he could be there. If he was not available, then the Committee could meet with the Speaker to subpoena him to appear before the Committee.
Ms M Mafolo (ANC) suggested that the apology be accepted. A date might be set, and the Minister may not be available because he had not recovered. No one prayed to be sick. The Minister had been appearing before the Committee and had shown a willingness to appear before the Committee. The Committee had to wait and see when he would recover before setting the date.
Mr S Jafta (ANC) said the date of yesterday had been set by the Minister, and he should be given a second chance.
Mr I Pikinini (ANC) said that the meeting must take place, but it was unfortunate that today was the last day of the Parliamentary session. The Chairperson and Whip must get a date next year when the Committee must meet with the Minister.
The Chairperson said that a notice of sick leave was before the Committee, which could not be ignored. The two weeks suggested by Mr Schimdt may not work, as many Members may not be available. The Chairperson suggested that in accepting the apology and noting the sick note, a date would be given to the Minister for the first working week of January 2018,. If the Minister had a problem with the date, he could suggest an alternative date. That would be the first issue of the Committee at the beginning of next year.
Mr Pikinini accepted the Chairperson’s proposal.
Mr Schimdt, while accepting the proposal, asked what would happen if the Minister did not appear on that date.
The Chairperson said if the alternative date by the Minister was not reasonable, the Committee would decide what to do and find a way forward.
Mr Pikinini said that the Committee wanted to address the issue at hand, so it had to make sure that the Minister attended the meeting.
The Chairperson suggested that the Minister be given the date of 24 January. If he did not appear, the Minister would be asked to suggest an alternative date, and if he did not appear on the alternative date, then the Committee would decide what action to take.
Members agreed to the proposal.
Mine lung diseases and silicosis class action cases
The Chairperson said there had been questions on the role of the Department of Mineral Resources (DMR) in dealing with the mine lung diseases and silicosis class action cases. The Committee had agreed not to deal with the merits or demerits of the cases for any of the parties involved, but clarity was needed on the role of the Department. The Committee had therefore invited the Deputy Minister, Mr Godfrey Oliphant, to take it through the political accountability on the issue.
Mr Oliphant said the matter relating to the class action went beyond South Africa. This class action was not the first one. Having grown up and worked in a mine, he knew that mining was a good asset for the country. South Africa was a strong mining country, but mining had also been damaging to the environment and had left people sick. It was for this reason that the legal fraternity had taken the negative aspects forward.
Where the state crossed paths with the legal fraternity was when they “mined” the mine workers. Most mine workers did not receive the compensation they deserved after the compensation had been paid out. The lawyers and the doctors were making a lot of money, especially in these class action cases. The Committee and the state had to check who the beneficiaries of the class actions were. This was a serious issue. It should not be a question of what the Department was doing alone, but what Parliament was doing.
In 2013, there had been people sleeping at the Union Buildings, asking for their money. The then Vice President had asked the ministers in the Departments of Health and Labour to find a solution. The number of people asking for compensation had reduced, however. The DMR had started with “one stop centres” for ex-mine workers. It had begun with a data base of between 600 000 and 700 000 ex-mine workers from both inside and outside South Africa. Those people could receive their unclaimed benefits. Out of 200 000 files, the Department had 106 000 names which it needed to track and trace. In the last financial year, the Department had been able to pay 7 737 thousand people a total amount of R280 million. Politically, the Departments of Labour and Health had to agree on the way forward.
This was a poverty problem, and the Department was looking for a solution. In the Eastern Cape, it was looking for an economic solution, such as rolling out farming opportunities as a way to help the ex-miners. The government was watching the outcome of the class action to determine how to finalise the plight of the ex-miners who were not able to get what was due to them. The incidence of tuberculosis was very high in the country, and mining was where it was concentrated.
Mr Schimdt asked what amount was available for the 106 000 outstanding claims for mine workers. More clarity was needed on the controlled and uncontrolled mines. When there was court case, it created a precedent -- would this class action set a precedent? What happened to employees who had legal liabilities when this case was settled? Did the attorneys collect money other than their contingency fees?
Mr Oliphant said that R1.5 billion had been aside for the 106 000 miners. Legislation for a “clean break” was related to a transfer of liability. It meant that those currently under the Occupational Diseases in Mines and Works Act (ODMWA) would stay there, while a new miner in the mining industry would start under the Compensation for Occupational Injuries and Diseases Act (COIDA), and there was no liability.
Dr Barry Kistnasamy, Compensation Commissioner, said there should be a relationship, or integration, of the Departments of Mineral Resources, Labour and Health, in the sharing of data, because this had really been a problem. On the data base, there were about 1 700 registered entities with the Department of Mineral Resources. There were 495 controlled mines among these 1 700. ODMWA covered mines and works, but unfortunately works were covered by the Department of Labour, and mines were covered by the Department of Mineral Resources. The integration of these laws was a very important issue.
The controlled mines meant the Department had an inspectorate function -- to check on hazards -- and this category paid levies to the Department. Non-controlled mines tended to fall under the COIDA legislation, and this was a problem in cases of compensation, especially when these workers had silicosis. The cases would be handed over to Department of Labour.
The clean break legislation did not transfer any liability. It did not need an amendment. COIDA was flawed because it did not have post surveillance, post mortem services, or screening services like ODMWA. Workers had been pushing for an amendment to COIDA so that if workers were being moved, they should not lose the benefits from ODMWA. The problem was that these benefits could not go to one class, as it extended to people such as farm workers spraying pesticide, or diesel mechanics exposed to diesel particles. COIDA was an injury-reporting system. ODMWA would be consolidated within the next financial year.
Ms Georgina Jephson, Attorney, Richard Spoor Inc Attorneys, said there had been a court judgment last year in May, which was a court precedent. A case would form a precedent, whether successful or not. The law firm did not charge any fees other than contingency fees.
Dr Kistnasamy said that the Department had inherited many legacy problems, such as no audited financial statements and annual reports since 2010/11, disclaimers in prior years, 30% of source documents not found, antiquated technical resources, inadequate human resources and infrastructure, and centralised services in Johannesburg. However, it had developed an evidence base, such as monitoring outputs, piloted innovations in service delivery, mobilised ex-mine workers, and linked with other social protection funds. It had also reformed legislation, built consensus on the approach and interventions with gold mining companies and class action lawyers.
The Department also had innovative service delivery, such as the one-stop service centres in Mthatha, Carletonville and Burgersfort, while one at Kuruman would be opened on 5 December.
There should also be a reform of legislation, especially changes to ODMWA, a governance structure for the Compensation Fund, streamlined administration, a levy to cover income protection, administration, medical assessments and health care. The clean break legislation should also cover current and ex-mine workers, and new workers joining the mining sector under COIDA. There was need to undertake study visits to gain insight into good practice, and to host scientific workshops.
The way forward in respect of the Portfolio Committee’s role was to convene a joint meeting of the Mineral Resources, Health and Labour Committees, to ensure financial services for ex-mine workers/beneficiaries, and to endorse the principles of the Department of Health that would accompany the settlement agreement.
There was a need for one occupational health and safety law that would be under the Department of Labour.
Ms Mafolo welcomed this information, and asked about the timeframe for the claims to be processed.
Mr Pikinini asked what steps had been taken to harmonise the laws on lung diseases? Many workers had died from these diseases since the class action began -- would their beneficiaries benefit from the trust fund? If a worker decided to opt out from the settlement, what were the prospects of getting a better deal? What were the plans of government to deliver a compensation system that functioned to the advantage of the mine workers?
Mr Oliphant said the timeframe depended on getting all the information. At the moment, money was looking for people rather than people looking for money. Many people were being paid each week. All the payments were overdue, because it was money owed to people.
The Department took about six months to work out the integration process. The resolution of the Cabinet had been in 1999, and the Department of Labour (DoL) had said it was not going to inherit the huge mess of files. Even up till now, Dr. Kistnasamy was still trying to get 2010/11 audited. When the DoL refused, the DoH had had a workshop, followed by a summit that included mine workers from other countries. This had produced a recommendation for integration. Lawyers had been put in place to do their work. The clean break had been a way to expedite the integration process.
The beneficiaries of the deceased could claim benefits.
Dr Kistnasamy said the DoH had worked on three pillars for the reform. The first reform was to improve service delivery, which were the one stop service centres which had started in 2014. There were also mobile service units and banking services, so that people could open accounts on site instead of taking their forms to banks for Finance Intelligence Centre Act (FICA) compliance.
If a deceased mine worker was not on the system, then it became a moral problem. The technical problem was that if a deceased mine worker had been on the system, the beneficiaries would get paid, but the deceased often had families in many different places. The Department had to ascertain who the real families were.
The class action would be a supplementary amount to the amounts paid by the Department.
The Chairperson asked the legal representatives what the dispute was in the class action. What did it mean, that an individual could take up the case separately even after settlement? In other words, did it suggest that an individual could take up the case on the grounds that he was not represented by the lawyers? What were the guarantees, or checks and balances, in place to make sure that the legal practitioners delivered what they promised their clients? How would the legal practitioners deal with the determination of compensation? What was the percentage interest of the legal practitioners in the event that the case succeeded?
One of the lawyers answered that it was good to hear that there was a data base. If it had been in existence six years ago, the difficulty and cost incurred in securing the information would have been less and people would have been paid a long time ago. The discussion was that the working group should pay the costs incurred, not the ex-miners themselves. For the state compensation, no money was being asked from the individual -- all that was being asked was for the miners’ money to be paid. There was a fee of 3% that was required by statute to be paid to someone who had put together the information and for maintenance of the database. The amount was too small considering all the work that had been done.
Where the lawyers were acting for the ex-miners against the DoH, the issue was for the DoH to open the doors for the lawyers to prove that the ex-miners worked for the controlled mines. The class action was about liability.
Ms Jephson said that the first stage of the case had been to convince the court that class action was the best way of pursuing the claim. The judgment was given in May 2016, in which the High court had said a class action was the appropriate way to pursue the claim. The second issue was for the court to determine that the mining companies were liable for causing silicosis and TB for mine workers underground. If liability was proven, then the next step would be to prove damages in terms of the monetary amount owed to the mine workers.
If settlement was achieved, an opportunity would be given to every member of the class action to opt out from the settlement, which meant that they would not be entitled to any benefits. They were at liberty to institute their own individual action against the companies they worked for.
Regarding guarantees, trustees had a fiduciary duty to the trust and the beneficiaries of the trust. There were checks and balances to remove any trustee who did not act in the interest of the trust. As lawyers representing the class, there was a duty to make sure that the trust paid out and acted in accordance with its objectives.
Determining the amount for compensation was an object of confidential negotiation. The litigation had been very expensive. There was a contingency fee that any award made to the client would be 15%.
The dependants of the deceased miners would be covered in the settlement trust.
Mr Kgomotso Molebatsi, from Sibanye-Stillwater, said that the first port of call regarding guarantees was to make sure that the settlement was paid out. It would go a long way to make sure that the trust paid out.
Dr Kistnasamy said that Section 124 (1) (c) of ODMWA provided that ‘any person who, in exchange for services rendered in respect of assistance in claiming any benefit in terms of this Act, charges a fee or claims remuneration from a person who was claiming such benefit in terms of this Act which was in excess of 0.5% of the benefit awarded to such person or any amount stipulated by the Director-General, shall be guilty of an offence and liable on conviction to any penalty which may in law be imposed on a conviction of fraud.’ Even though this was a charge on the claimant and not the state, the state could take action against the lawyer if he or she charged in excess of 0.5%.
Mr Oliphant said the Committee should not ignore this issue of fiduciary duty. In some cases, there had been cases of trustees not paying out -- they took their 15% and disappeared. This should be a case study so that the mistakes were not repeated. This could become a scam, as the beneficiaries may not receive anything. The database and information of mine workers in possession of these lawyers belonged to the State.
Mr Schimdt said there was no automatic development from silicosis to TB. How could one prove that the diseases had grown from silicosis to TB? How were the working group dealing with circumstances such as TB, which was not incurred from mining but from other conditions, such as sitting next to someone outside of the mine. What was the timeframe for the payment of claims?
Ms Mafolo asked where the ex-miners association fitted in to the issue at hand.
Dr Kistnasamy said the timeframe chart would be made available to the Committee. It was a monitoring tool, which started monitoring from the time a person made a claim until the time he was compensated. There were also three tools which the Department of Health, Department of Monitoring and Evaluation and Treasury was working together on, which were assessment, certification and payment.
The Department was working with the Chamber of Mines on the progression of TB and how it could be managed.
Loss of earnings was not covered by the class action.
Mr Abre van Vuuren, Executive: Special Projects, Harmony Gold Mining Company, said that to fix the issue at hand, there should be reform of legislation, and the backlog of those due for compensation should be dealt with, but not under the control of the working group. All mine workers in the private sector were covered by COIDA. The integration of the compensation from COIDA and ODMWA was a simple one, and should be done in the future.
The Chairperson said that the responsibility of government was to safeguard the interests of the vulnerable. Some areas required the intervention of the government, such as the reform of legislation. Trust accounts had proven to some degree to be problematic and people looked to the state to protect them. The Chairperson asked Mr Oliphant to work towards making sure that there was a comprehensive database system, come next year. He further suggested that there should be collaboration in the distribution of the trust account, involving both the state and the working group. When the class action had been resolved, a progress report should be submitted to the Committee.
Mr Oliphant said that he had received a letter from the Parliamentary liaison officer that on 24 August 2006, Parliament debated the subject of the 60th anniversary of the African mineworkers’ strike in 1946, marking the significance and role of the working-class movement in the transformation of the country. Parliament had taken the following resolution:
The House knows that 12 August 2006 marks the 60th anniversary of the mineworkers’ strike in 1946, and further knows the important role played by the mineworkers in the development of the country and transformation of the economy. The demands of the African mineworkers’ association in 1946 were not fully addressed were still relevant today. It therefore resolved that:
- The living and working conditions of mine workers be investigated further and improved.
- To support the initiative of the National Union of Mine Workers to build their workers museum.
- That Parliament considers naming some of its building after JB Marks and leaders of the African Mine Workers’ Union and other heroes of struggle.
As an ex-mine worker, law maker, regulator, and someone with the mandate from the Presidency, the political responsibility to move this programme forward was given to the Minister of Mineral Resources.
The fatalities from accidents in the mines had increased and the situation was not getting better. The Department would delay dealing with the issue of controlled and uncontrolled mines, the integration process and the negotiation. The most deaths in the country were because of TB, and a programme would be considered to solve this problem.
The Ex-Mineworkers’ Association was formed because of people being disorganised, so that they could be encouraged. The system had collapsed because it had been geared towards white workers, and when it started getting black mine workers, it had collapsed.
The Chairperson suggested that all parties exchange their contact details, and also asked that a progress report be sent to the Committee.
Consideration and Adoption of Minutes
The motion for the adoption of the minutes of 22 November was moved by Mr Pikinini and seconded by Ms Mafolo.
The meeting was adjourned.
Download as PDF
You can download this page as a PDF using your browser's print functionality. Click on the "Print" button below and select the "PDF" option under destinations/printers.
See detailed instructions for your browser here.