Report of the Ad-Hoc Committee on Matters Relating to the Ex- Mineworkers’ Union dated 25 March 2008:

 

1. Introduction

 

Following the occasion of the People’s Assembly, which took place in Mbhizana in the Eastern Cape from 17 to 19 September 2007, Parliament established the Ad-hoc Committee on Matters Relating to the Ex-Mineworkers Union (hereafter referred to as the Committee). A motion was tabled in the National Assembly on 19 September 2007 for the establishment of the Committee to look at the concerns of the Ex-Mineworkers Union.  The following were terms of reference of the Committee:

 

·     To investigate matters raised in submissions from the Ex-Mineworkers Union.

·     To take into consideration records, reports and submissions by stakeholders who have previously been involved in this matter, including the Premier’s Office of the Eastern Cape, the office of the Executive Mayor of the OR Tambo District Municipality, the office of the Mayor of Tshwane, the Presidency and Government Departments such as Labour, Minerals and Energy, Health and Social Development.

·     The Committee to exercise those powers in Rule 138 that may assist it in carrying out its task and

·     To make recommendations that could assist in addressing the above-mentioned and related problems.

 

The Committee comprises thirteen members from different parties represented in the National Assembly. The Committee was initially required to report to the National Assembly in October 2007, a date later extended to the 31 March 2008.

 

The focus of the Committee was, in addition to the terms of reference of the Committee, to follow up complaints received from the Ex-Mineworkers Union regarding an undertaking made by certain Government offices in regard to payment of social assistance and unemployment benefits.

 

There were no less than thirteen meetings that were convened to discuss the mandate given by the National Assembly and the manner in which the process would be carried out. The Committee agreed and received presentations from a number of institutions and organizations that were considered to be party to the issues relating to the Ex-Mineworkers Union. These institutions and organizations included, inter alia, the following:

 

·     Office of the Speaker

·     Ex-Mineworkers Union

·     Premier’s Office (Eastern Cape)

·     Ex-Natal Coal and Gold Mineworkers

·     National Department of Health

·     Department of Labour

·     Chamber of Mines

·     National Union of Mineworkers

·     Mineworkers Provident Fund(1989)

·     Mines’ 1970 Provident Fund

·     The Employment Bureau of Africa Limited

·     Department of Health (Eastern Cape)

·     Fidentia Curators

 

The purpose of this report is to fulfill the mandate given to the Committee by the National Assembly and submit recommendations to the National Assembly for consideration.

 

2. Issues of Concern by the Ex-Mineworkers Union   

 

In 2005 a group of people led by Mr E. Nomazele descended on and assembled at the Union Buildings demanding to meet the President with regards to unresolved issues pertaining to certain claims for compensation dating back to 1987. According to the information from the Presidency the following issues were the concerns of the ex-mineworkers:

 

·     Establishment of a Trust Fund for Administering R54 Million which was held by the Compensation Commissioner for Occupational Diseases.

·     Extension of Adult Basic Education and Training (ABET) programs for the empowerment of Ex-Mineworkers to assist them with income generation, skills development and knowledge.

·     Release of Monies held by Mine Provident Funds.

·     Death and Disability Benefits.

·     Long Service Awards.

·     Ordering of the Compensation Commissioner to disregard the Act or Law that disqualified some relatives as beneficiaries or claimants.

 

According to the Presidency, during the meeting with the ex-mineworkers at the Union Buildings, a process was agreed upon at the meeting that all relevant details of everyone with a legitimate compensation claim that was outstanding be obtained. It was further agreed that these would be taken in terms of specific issues each individual had with respect to Unemployment Insurance Fund, Health and Provident Fund related claims. Furthermore, that there would be no group resolution as each case would be dealt with on its merits.

 

3. Committee Briefings and Matters of Process

 

In the process of pursuing its responsibility, the Committee held thirteen meetings and received briefings and presentations:

 

 

3.1. Office of the Speaker

 

The information shared revealed that the Office of the Speaker got involved in the matter in February 2006, mainly as a reaction to a letter that was written to the Speakers Office, threatening a protest on the day of the State of the Nation Address.

The information shared with the Committee also revealed that the concern of the Ex-Mineworkers related to occupational diseases contracted by their members and the fact that the matter, which was raised with the Presidency, had not been given the attention they expected. At a subsequent meeting which took place between the Ex-Mineworkers representatives and the Office of the Speaker, the issue seemed to have been around the lack of response or report back since a meeting which took place in 2005. 

 

3.2. Ex-Mineworkers Union 

 

The Presentation made by Mr Nomazele, who is the President of the Ex-Mineworkers Union, laid bare the issues and concerns of  members of the Ex-Mineworkers Union. The presentation took the Committee back to the 1987 strike when NUM ordered ex-mineworkers to go home without having been paid. This was one reason for them to suspect that NUM had a hand in their problems. The Ex-Mineworkers Union indicated that a number of steps were taken and all was in vain. These steps included instituting legal proceedings, asking for assistance from organisations and soliciting intervention of personalities and various institutions.

 

This resulted in payment of what they consider to be a small portion of the enormous sums of money that are due to them. Linked to the payment is the concern on who qualifies as a beneficiary.

 

In the view of the Ex-Mineworkers Union beneficiaries should include partners of the Ex-Mineworkers and close family members such as brothers and sisters. The Ex-Mineworkers Union is concerned that an amount of R54 million which was to be paid out to ex-mineworkers could not be paid out and alleged that this was due to interference by the Department of Labour.

 

It was at this point that in 2006, the Ex-Mineworkers Union elevated their concern to the Presidency. The Ex-Mineworkers Union alleged that an undertaking made by the Provincial Government of the Eastern Cape at the Union Building was not fulfilled. The undertaking made in Pretoria to pay ex-mineworkers monthly food vouchers of R840, was only paid to some of the ex-mineworkers. It was on this basis that the ex-mineworkers wanted to disrupt the People’s Assembly. Moreover, the Ex-Mineworkers Union is of the view that there is an amount of R3 million which was supposed to have been paid to ex-mineworkers which the Government and the NUM are withholding.

 

3.3. Ex-Natal Coal and Gold Mineworkers (Mr P. Nyamfu)

 

The ex-mineworkers residing in King William’s Town who worked in the coal and gold mines of the former Natal Province had similar concerns as the members of the Ex-Mineworkers Union led by Mr Nomazele. These second group, which is led by Mr Nyamfu, staged a sit in the Office of the Premier of the Eastern Cape demanding the payment of benefits to their members.

 

3.4. Office of Premier of the Eastern Cape (Mr P. Xotongo)

 

The Office of the Premier of the Eastern Cape confirmed that the R54 million that is supposed to be paid to the ex-mineworkers is administered by the National Department of Health. It was brought to the attention of the Committee that a certain amount or portion of the R54 million has been paid to qualifying beneficiaries, who are not necessarily members of the Ex-Mineworkers Union.

 

It was also reported that the list of beneficiaries in possession of the National Department of Health and the list of beneficiaries in possession of the Ex-Mineworkers Union do not tally. The money for qualifying beneficiaries was available but the main obstacle was the fact that many of the beneficiaries could not be traced. 

 

With regard to the issue of food vouchers, the Office of the Premier reported that a means test was applied and as a result of which some people were disqualified from receiving food vouchers as they appeared as recipients of social assistance on the database of the Department of Welfare. This means that only those ex-mineworkers who were not appearing on the database of the Department of Welfare were eligible for food vouchers.

 

This was not meant to be a monthly social benefit but a once-off and a pro tempore arrangement that was to occur when the ex-mineworkers return from the union Building in Pretoria. However, the Office of the Premier conceded that the promise was made under duress and pressure exerted by ex-mineworkers.

 

3.5. Department of Health

 

The National Department of Health first dealt with the matter of Ex-Mineworkers after 1994 democratic elections through the office of the Compensation Commissioner for Occupational Diseases (CCOD). It was during this period that R54 million was transferred back to the CCOD. In the period 1994 to 1996 the Department received incomplete records. In August 2002, after receiving numerous complaints a task team was established consisting of the Provincial Department of Health (Eastern Cape) and the National Department of Health, Chamber of Mines, House of Traditional Leaders, Department Labour (Provincial Office) and NUM. The purpose of the task team was to assist in tracing possible beneficiaries. 

 

In 2003 the Department began a process of capturing information from old files, a process which resulted in a compilation of a list of 18 500 names of possible beneficiaries. The list was used to pay a total of 11 200 people who qualified, each receiving R2 700, after approval by the Minister of Health. This process to pay out the 11 200 individuals began in March 2003. The money was paid out from the original R54 million and the current balance is about R20.8 million that still needs to be paid out to qualifying, but untraceable beneficiaries. 

 

From July to September 2003 the Compensation Commissioner of Occupational Diseases staff visited different regions of the Eastern Cape in an effort to trace possible beneficiaries. These efforts were hampered by  members of the Ex-Mineworkers Union who disrupted meetings, chasing away beneficiaries and destroying application forms, demanding interest on the R54 million and exclusion of mineworkers from the then Ciskei. Since 2004, the Occupational Health Nurses took over the work of the task team, after they were trained, in identifying beneficiaries and qualifying claimants thus rendering the task team redundant and dysfunctional. The process of identifying eligible beneficiaries and claimants is on-going.

 

3.6. Department of Labour

 

The Department confirmed the existence of the R54 million, adding that it was available and was being paid to legitimate claimants. The payment of beneficiaries is implemented by the Department of Health and is continuing through a process of verification and screening.

 

Unemployment Insurance and Compensation for Injuries have been paid to legitimate claimants and are still being paid when relevant documentation is presented.

 

The Department pointed out that it was communicated to the Ex-Mineworkers Union that payments can only be done within the confines of the law. Furthermore, that payment would always be paid to those beneficiaries who presented the requisite documentation as proof that they or their dependants sustained injuries or diseases on duty. The Department assured the Committee that the affected Departments have always done all within the law to serve the group and would continue to do so.

 

3.7. Chamber of Mines 

 

The Chamber of Mines emphasised the fact that the long-service award scheme regulated payment of service that was not pensionable in terms of the rules of the Mineworkers Provident Fund, the 1970 Provident Fund and Pension Fund for the Mines and all the funds approved by the Chamber of Mines at the time, which complied with the rules on the long-service awards.  In terms of the scheme to qualify as a recipient of the scheme a person should have been an employee or dependent.

 

Further requirements were that, in case of an employee, s/he should be above 55 years of age and have been a worker for ten years or more. Moreover, if an employee was in the employ of a mine before 1981 and now not any longer in the service of a mining house qualified for the award. The other category that qualified for awards were those employees who had been retrenched, having served the company for at least ten years and were above the age of fifty. In the case of death after fifteen years of service the dependant would receive the benefits that could have been paid to the deceased.

 

The payments and processing of the award when the employee was still in the service of a mine was solely the responsibility of the employer and if the employee was out of the service of a mine, the employee made the application through The Employment Bureau of Africa (TEBA) Limited and/or the employer. TEBA also took responsibility to pay long-service awards to mineworkers who where in a service of a closed mine. Thus, the Chamber of Mines was not responsible for the payment of compensation or awards to ex-mineworkers, but only regulated the payments of awards in respect of service that was not pensionable.

 

The other additional points raised by the Chamber of Mines included the fact that the Mineworkers Provident Fund was for people who had been in the service after 1989 and were paid to beneficiaries upon death, not on retiring or leaving the services.

 

The Committee was informed that the Ex-Mineworkers Union had provided a list of names and employee numbers to the Mineworkers Provident Fund. In the list provided, the Mineworkers Provident Fund could only find nine persons in their records and those people were paid the benefits due to them.

 

The Committee was informed that the Chamber of Mines does not trace beneficiaries and ex-mineworkers. The Chamber of Mines employs the services of TEBA to trace beneficiaries and ex-mineworkers. TEBA charges the Chamber of Mines for the service that they render to them.

 

Moreover, the Chamber of Mines indicated to the Committee that a project to trace ex-mineworkers has been established. These ex-mineworkers are assisted to receive medical examination and if found to have contracted occupational diseases they are accordingly compensated. There is an amount of R42 million which has been set aside for this purpose and would be rolled out over a period of five years.

 

3.8. National Union of Mineworkers

 

The National Union of Mineworkers (NUM) informed the Committee that it did not handle compensation on behalf of workers and that they did not act as a conduit for payments. However, they admitted that they assist mineworkers in lodging their claims.

 

NUM insisted that that their role was to raise the issue of the conditions under which mineworkers work, by for example making recommendations to employers and/or influencing legislation. They also admitted to playing a role in setting up trusts and once these are in up and operational they become responsible for their own rules, as independent entities.

 

In addition, NUM also indicated that in the evolution of the problem of ex-mineworkers they were not in the aware who the Ex-mineworkers Union met and interacted with.

 

With regard to the R54 million NUM informed the Committee that it had no knowledge of the money, adding that TEBA handled the monies of mineworkers.

 

3.9. Mineworkers Provident Fund (Mr S. Sidu)

 

The Mineworkers Provided Fund was established to regulate and process the payments of money to beneficiaries of the Fund. The Board of Trustees of the Fund comprise of equal representatives from both the Chamber of Mines and NUM. The Fund was established in 1989 and the beneficiaries are the employees who have been in the service of the mines after 1989. The payment period for all beneficiaries is six months in case of dismissal and resignation and payment was made instantaneously in case of retrenchments. The Fund also provides for surety with regard to members when applying for housing loans. The ex-mineworkers who were in service prior to 1989, are catered for under the 1970 Provident Fund.  The Fund covered, among others, death on duty after one year of service and funeral benefits. With regard to Occupational Injuries and Diseases, it was indicated that these were paid by Rand Mutual Assurance (RMA) or in some cases in terms of the Compensation for Occupational Injuries and Diseases Act (COIDA) 1993.

 

3.10. Mines’ 1970 Provident Fund (Mr K.Nkosi)

 

The Fund was established in January 1970 for the benefit of mineworkers employed by members of the Chamber of Mines. However, in 1989 a new Provident Fund, namely the Mineworker’s Provident Fund, came into existence and as a result most members deserted the 1970’s Provident Fund. With this dramatic fall in membership, in 1994, the Board of Trustees proposed to employers the closure of the Fund. There were mineworkers who had invested money in the Fund that was being closed down.

 

In September 2000, all the active members who were members of the 1989 Provident Fund had been transferred to other Funds. The new Fund looks after the Fund’s Investment Portfolio, in addition to tracing and paying out to ex-mineworkers who are no longer employed or failed to claim benefits from the Fund when they left employment. The Investments of the Mines’ 1970 Fund, currently stand at about R200 million. The number of ex-mineworkers that must still be paid is 59 702.

 

The Committee was also informed about actions taken before and after 2001 to trace ex-mineworkers who were members of the scheme. The Committee was informed that according to recent analysis of the Fund’s database, there could be some of the ex-mineworkers who were registered in the Fund that closed down. The database of the closed Fund, shows that there could be some ex-mineworkers who left one employer and rejoined the Fund in the name of another employer. From a list provided by the Ex-Mineworkers’ Union, eighteen common members were identified of which six were paid, and three had been transferred to another Fund, and nine subsequently received payments.

 

The Committee was informed that, dates of birth of most ex-mineworkers who were members of the Fund were registered as the 1st of January of the year following that in which the member was deemed to have been born. This proved to be a complicating factor in verifying the identities of ex-mineworkers who presented themselves to the Fund for unclaimed benefits. Most identity documents issued by Department of Home Affairs have particulars that are different from those of the Funds.  

 

3.11. THE EMPLOYMENT BUREAU OF AFRICA LIMITED (Mr J. Motlatsi)

 

The Committee was informed that the role of The Employment Bureau of Africa Limited (TEBA), which used to be that of a mine’s recruiting agent, has diametrically changed. TEBA is currently a Black Economic Empowerment entity which provides support services to rural families in labour-sending areas and to Provident Funds. The role of TEBA in regard to the concerns of the Ex-Mineworkers Union is limited to tracing ex-mineworkers when approached and contracted for a fee by the Chamber of Mines. There are no links or relationship between the concerns and problems that are raised by the Ex-Mineworkers Union and TEBA since TEBA only provides a commercial service to the Chamber of Mines to trace former employees of mines. However, TEBA still has records of ex-mineworkers which they keep and use to trace former miners.    

 

3.12. Department of Health in the Eastern Cape

 

The Medical Bureau for Occupational Diseases and Compensation (MBOD) in the Eastern Cape provided training to Occupational Health and Safety Coordinators with an aim of assisting in dealing with issues related to occupational diseases not excluding issues related to the concerns raised by the Ex-Mineworkers Union.

 

In order to conduct medical examination and test procedures the Occupational Health and Safety Co-ordinators visit the institutions where there are ex-mineworkers. This is happening in places that are accessible to ex-mineworkers and the Co-ordinators assist them. Chest X-Rays examinations are done, with the Co-ordinators assisting in completing all the necessary forms. The physical examination is conducted by a qualified medical practitioner.

Following these medical procedures and examinations, the documentation and reports are send to the MBOD which prepares a report and process the documents accordingly. 

 

3.13. Fidentia Curators

 

Mr. Gihwala (Curator) informed the Committee that NUM invested R789 million in Fidentia. This money was previously invested with Old Mutual. Fidentia operated as a “pyramid” scheme and wasted money that was invested with them. It is common knowledge that Fidentia was now under curatorship and parties involved in mismanagement of funds are being pursued legally.

 

Since the curators took over, they have recovered about R93 million for the NUM provident fund and approximately R90 million has been paid out as stipends to widows and orphans of deceased mineworkers. Funds invested with Fidentia are intermingled and it is therefore difficult to ascertain who invested how much. The curators are prepared to share additional information with the Committee on relevant matters on issues that are not subjudice.  There are lists of people that are with the Banks reflecting the investments which people made. The Committee was also informed that financial transactions made during the period could not be followed. Thus, it will be impossible for many investors and/or beneficiaries to recoup all the money that was invested in Fidentia. 

 

4. CONSTRAINTS OF THE COMMITTEE

 

The Committee was faced with serious constraints including the fact that a bulk of the information that was brought to the attention of the Committee came through the presentations made by stakeholders and letters received from the Presidency. The other constraints were that the Committee could not verify the information through the inspection of records. Moreover, various Departments and offices interacted with the Ex-Mineworkers Union prior to the establishment of the Ad-hoc Committee, making undertakings different to each other. These interactions were haphazard and uncoordinated. All these factors and engagements made the work of the Committee more complicated and difficult. 

 

 

 

5. Findings

 

The main finding of the Committee is that there is substance in the concerns of the ex-mineworkers. The overall impression that the Committee draws is as follows:

 

·         There are many stakeholders in this matter. The stakeholders that appeared before the Committee absolved themselves of any wrong doing. The manner in which the whole enquiry unfolded makes it difficult to achieve the desired objective.

·         The stakeholders are involved in different activities to attempt to resolve the matter but there is no coordinated approach.

·         In the past there were no proper records of identities of miners that were kept and this makes it difficult to trace the ex-miners or their beneficiaries. This problem is compounded by the tendency of the mineworkers not to reveal the terms of their employment benefits to their spouses.

·         As a result of difficulties in tracing beneficiaries, monies that are supposed to be paid to them are kept by institutions. The following institutions were identified:

 

INSTITUTION

AMOUNT

 

 

Fidentia

R789 million

National Department of Health

R20 million

Chamber of Mines

(for the project to, among others, trace beneficiaries)

R42 million

 

·         The ex-mineworkers want the definition of a beneficiary to be expanded to include distant relatives like the in-laws. This may be considered if there are legal limitations related to the rules of the Funds in which ex-mineworkers are members. 

·         It came out during the enquiry that in the process of attempting to resolve this matter, promises were made by certain Departments and Institutions.

·         The mining houses are denying knowledge of records that are supposed to have been kept by them.

·         The Provident Fund was identified as the main holder of the monies for ex-mineworkers.

 

6. RECOMMENDATIONS

 

The Committee, having noted the issues emanating from the presentations and briefings, including its own findings, wishes to recommend that the Executive consider the following:

 

6.1. The Establishment of an Interdepartmental Task Team consisting of the Department of Labour, Department of Health, Department of Minerals and Energy and National Treasury.

 

The main tasks of the Interdepartmental Task Team should be;

 

(a) To process the findings and recommendations.

      (b) To trace all the monies that belong to the ex-mineworkers and once

            found transferred to the State for disbursement.

      (c) To publish regular reports on both the electronic and print media.

 

6.2. The Interdepartmental Task Team could be headed by a senior official from the Department of Labour.

 

6.3. All the claims have to be processed from one office which should be coordinated and managed by the Interdepartmental Task Team.

 

6.4. Monies for ex-mineworkers that could not be traced must be transferred to the State. The Committee recommends that the ceded money should be used for development in the labour-sending areas. This should follow after the process to trace the beneficiaries has been substantially exhausted.

 

6.5. In relation to 6.4. above, relevant legislation regarding the transfer and use of the money may require amendment. In addition, the rules of the relevant pension funds must be amended and this might also require legislation as in some respects this will amount to an expropriation

 

6.6. The transaction made between Old Mutual and Fidentia needs to be investigated as this could involve huge sums of money. 

 

6.7. All documents kept by stakeholders that could assist in tracing beneficiaries should be surrendered to the Interdepartmental Task Team and kept by the Department of Labour.

 

6.8. The Parliamentary Portfolio Committee on Labour should play an oversight role in the implementation of the recommendations and for this reason could receive regular briefings from the Interdepartmental Task Team.

 

6.9. The Minister of Labour should table the final report of the

Interdepartmental Task Team to Parliament.

 

 

 

 

ADdendum

 

 

 

(a) List of Members of the Ad-hoc Committee

 

 

  1. Hon R.M. Sonto (Chairperson)
  2. Hon E.N. Mthethwa[1]
  3. Hon N.F. Mathibela
  4. Hon E. Mtshali
  5. Hon B.M. Mkongi
  6. Hon M. Matsemela
  7. Hon W. Direko
  8. Hon J.B. Sibanyoni
  9. Hon A. Dreyer
  10. Hon H. Schmidt
  11. Hon E.J. Lucas
  12. Hon P.J. Nefolovhodwe
  13. Hon L. Greyling

 

 

 

(b)  List of Stakeholders and Presenters

 

 

  1. Office of the Speaker:                             Adv N. Cetywayo

 

  1. Ex-Mineworkers Union:                           Mr E. Nomazele

                                                                              Mr N. S.M. Ngoma

                                                                              Ms L. Mbikwana

 

  1. Ex-Natal Coal and Gold Mineworkers:      Mr P. Nyamfu

 

  1. National Department of Health:                Mr T. Mseleku

                                                                              Mr B.K. Mashego

                                                                              Mr  F.G. Muller

                                                                              Ms T. Khaka     

 

  1. Department of Labour :                           Mr T. Ngonyama

                                                                                    Mr W.C. Mafu                                                

                                    Mr T.B. Seruwe

                                    Mr S.P. Zondeki

                                    Mr M.P.Mothiba

 

  1. Chamber of Mines:                                             Dr E.M.L Strydom

Dr F.S. Barker

  1. National Union of Mineworkers:               Mr F. Gona

 

  1. Mineworkers Provident Fund(1989) :        Mr S. Sidu
  2. Mines’ 1970 Provident Fund:                   Mr K.Nkosi

                        Ms N. Erasmus

                        Dr . Winson

  1. TEBA:                                                   Mr T.J. Motlatsi

                                                                  Mr G. Human

 

11. Department of Health (Eastern Cape):      Ms P. Mkalipi

                                                                                    Mr A. Wild        

 

  1. Fidentia Curators:                                              Mr D. Gihwala

 

 

Report to be considered.



[1] The above Honourable Member was part of the Committee at its inception in his capacity as a member of the Portfolio Committee on Minerals and Energy.