Edition: February/April 2018
Editorials

TRUSTEESHIPS

A cloud that must be lifted

Otherwise it will continue to hang over Cosatu official and Pensions Registrar on application of �fit and proper� requirements.

Jan Mahlangu has a formidable presence. He knows what he�s talking about and is highly effective in fighting his corner, even to the extent of blunting progress on retirement-fund reform, from his platform as the Cosatu coordinator of pension and provident funds.

But the wood in this platform has a little beetle. The infestation is caused by his acceptance of a motor vehicle from a service provider, the consequences of which remain unexplained. It�s within his right not to explain them, at least for public consumption, and he has exercised this right by not responding to a series of questions that TT has put to him (see box).

Nice car if you can get it

The Financial Services Board, by its professed claim of �proactive engagement with the media�, would eschew a similar right. Yet it simply doesn�t respond to these same questions. What�s more, the FSB is the overseer of �fit and proper� standards for trustees. FSB executive officer Dube Tshidi has recently published for comment a draft directive �to determine conditions to be imposed by the Registrar of Pension Funds in order to combat and prevent bribery and corrupt practices�.

It�s emerged that Tshidi, at some point earlier, used s26(2) of the Pension Funds Act to make Mahlangu a trustee of the South African Local Authorities (SALA) Pension Fund and the Municipal Councillors Pension Fund. In fact, Mahlangu chairs the MCPF board of trustees. He�s also a trustee of the SALA Beneficiary Fund.

The implication is either that Tshidi satisfied himself that Mahlangu is �fit and proper� or that, without having satisfied himself, he made the appointments nonetheless. In terms of s26(2), the Registrar may appoint trustees where the board of a fund is not properly constituted. Either way, Tshidi isn�t saying.

Neither is Mahlangu. His troubles started in 2010 when the gift of an Audi A4 from an official at financial-services consultancy SA Quantum was revealed. Having then resigned from Cosatu, three years later he was rehired. Later still, thanks to the Registrar, he gets these various trusteeship appointments of which at least one is highly lucrative.

A document to hand indicates that, for the year to end-September 2017, Mahlangu was paid R651 000 by the SALA Pension Fund. This averages over R54 000 per month. It�s paradoxical that trade unions have long argued against payment to trustees when they serve as part of their workday shop-steward jobs.

A legitimate strategy is not to respond to media queries, in the hope that they�ll blow away, but it carries the risk of losing the opportunity to comment. Here, the affected parties still have that opportunity but obviously now only for the next TT edition. It is particularly hoped that the Registrar will avail himself of the opportunity as the FSB positions itself to become the Financial Sector Conduct Authority.

UNANSWERED QUESTIONS

Efforts were made to extract pre-publication comment from Jan Mahlangu and Dube Tshidi. The email below was sent to several addresses of Mahlangu, and copied to Tshidi, on Nov 29. It was resent on Dec 1 and also forwarded to two Cosatu officials. None even acknowledged receipt.

Mahlangu . . . dead silence
Mahlangu . . . dead silence

Dear Jan

I notice from its website that you are a trustee of the SA Local Authorities Benefit Fund and understand that you are also a trustee of the SALA Pension Fund. It is further noticed, from your circular MCPF 2/2017 to all municipalities, that you are chairperson of the Municipal Councillors Pension Fund s26 board of trustees.

Firstly, to obtain clarity:

a) Was there ever an inquiry by Cosatu into the gift of

an Audi A4 to you by service provider SA Quantum? If so, what was the inquiry�s outcome?

b) What has happened with this motor vehicle? Did

you return it to SA Quantum, have you sold it or do you still have it? What is or has been the financial value of this vehicle to you?

c) In evaluating the suitability of your appointment

as a MCPF s26 trustee, were you required to explain to the Registrar the reasons for your resignation from Cosatu in 2010? If so, what reasons did you submit in order to satisfy the Registrar that you met the �fit and proper� requirements for trusteeship? [I have copied relevant FSB officials on this email as an invitation for them also to comment.]

Secondly, in view of your 2013 reinstatement as Cosatu coordinator of pension and provident funds:

1. Are you a paid Cosatu official? If so, are you a full

or part-time employee?

2. Has Cosatu approved your trusteeships of the SALA

funds and of the MCPF? If so, on what basis?

3. What are your comments on possible interest

conflicts between your Cosatu and trusteeship responsibilities?

4. Do you receive payments for your respective

trusteeships? If so, in what amounts and have these been disclosed to Cosatu?

I look forward to your response by next Friday, Dec 8. It should be expected that such response, in addition to comments that the FSB may provide, will be published in full.

Sincerely
Allan Greenblo