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Parliament’s public finance watchdog, Scopa, refuses to further tolerate the Compensation Fund’s total incompetence and dysfunctionality, by actively tightening the noose around the Fund’s corrupt officials’ necks.

During the National Assembly’s hearing Scopa Chair, Mkhuleko Hlengwa, ordered Employment and Labour Minister, Thulas Nxesi, to conduct a full-scale investigation into the Fund after numerous adverse reports by the Auditor-General.

The following deeply concerning issues were, not only raised by the various probing parties at the hearing, but also fully acknowledged by the Fund’s Commissioner and Director-General, as well as the Minister:

  • incessant, blatant, rampant, and unprosecuted fraud by the employees and management of the Compensation Fund, for the past 10 years;

  • complete lack of skills of the employees at the Fund, from top management through the ranks;

  • millions of Rands wasted on irregular, fruitless and wasteful expenditure, with absolutely no consequences for the responsible parties;

  • the incompetence of the Minster, the Commissioner and the Department’s Director-General, as well as the Fund’s COOs, CFOs and other managers. Despite which, still received performance bonuses and thirteenth checks;

  • in an attempt to ensure proper skills attraction, as well as the avoidance of corruption, an argument for the conversion of the Fund to a full Schedule 3a entity was made by the Minister – therewith effectively acknowledging that any Fund administered by the State will ultimately fail;

  • the Minister and Commissioner’s baseless argument that the failure of the Fund should be attributed to the non-registration and non-compliance of employers, yet they have no functional arm that ensures compliance; and

  • no functional claim systems - backlog in claims, dysfunctional website and lack of proper communication.

With yet another State-controlled fund collapsing into ruins, it begs the question, is it not time for government to realise that they are incapable of running these types of funds and that it should be outsourced to the private sector?


Article By:

Hilton Johnson: CEO - Compliance Hub

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