Cosatu has called on the Public Investment Corporation (PIC) to ensure that the boards of its clients have direct links to companies in which they invest to avoid the disappearance of billions of rand that has occurred.
The country’s biggest trade union federation also wants the boards of the Unemployment Insurance Fund (UIF) and the Compensation Fund to be independent from the minister of labour, and to hold their officials and the PIC accountable.
These are some of the policy resolutions arising from Cosatu’s affiliates as the federation prepares to hold its 14th national congress next month.
Both the UIF and the Compensation Fund – which fall under the department of labour – are big clients of the PIC, which is Africa’s largest asset managers, with assets worth R2-trillion under management. The PIC has been a space contested by the country’s political elite vying for billions in funding.
In March 2020, a judicial commission found there had been “substantial impropriety” at the state-owned asset manager.
The commission, headed by retired judge Lex Mpati, found there was potential criminal behaviour in how some of the former board members had links to companies the corporation irregularly invested in, and how the PIC had not shown urgency to recover money invested wrongfully.
Cosatu is a major player in the PIC, due to the presence of its public sector unions in the Government Employees Pension Fund, which is the PIC’s largest client.
According to a document prepared for the federation’s congress, workers want accountability from the PIC and its clients. “The PIC mandates must ensure that the boards of its clients have a direct link with investee companies to avoid the continuous loss of billions, which get wasted, disappear without ‘any trace’ with no consequence management,” the paper states.
“By the end of the August 2022 period, it was likely that the UIF would have released over R53-billion to more than seven million workers. The UIF Covid-19 relief reached over four million workers and was likely to exceed R60-billion in payments. This has taken the UIF from R154-billion before the lockdown to R110-billion – R60-billion of the R110-billion was liquid and accessible.
“It is long overdue that the UIF and Compensation Fund should have executive boards independent from advising any minister or any entity with a clear focus on ensuring maximum benefits for workers and be in a better position to hold all officials and PIC to account given how monies are lost in these funds with little power enacted in the legislation,” Cosatu said.
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