Issue: July/Sept 2010
NBC rights and wrongs
As always, we find the information in your publication very useful reading and wish to thank you for it. In your April-June 2010 edition, however, we read a snippet about NBC and the Private Security Sector Provident Fund (PSSPF). We wish to set the record straight:
Firstly, NBC was not fired as administrator by the PSSPF board of trustees. NBC voluntarily resigned from providing administrative and other services to the PSSPF on 14 Oct 2009. After tendering our resignation, we issued a press statement that highlighted the major reasons. They included:
Secondly, NBC was never threatened with legal action for allegedly refusing to hand over the PSSPFs records to the fund's new administrators. PSSPFs board of trustees knew the reasons that forced NBC to withhold handover of the fund's records; the main one being the refusal of the new board (without valid legal reasons) to pay NBC its lawfully due and payable remuneration for having rendered administration services to the fund.
During the period of the unwarranted withholding of remuneration by the board, NBC continued to act responsibly and to comply fully with its administrative obligations in accordance with the service-level agreement between itself and the fund.
In any event, and despite the funds board putting NBC in a tight financial corner by its refusal to pay the remuneration, NBC still managed to ensure that the hand-over process went smoothly and was completed within the prescribed period.
Thirdly, regarding the conduct of the then Pension Funds Adjudicator towards NBC, we can now confirm that she was motivated by reasons that fell outside the jurisdiction of her office by treating and publicly criticising NBC in the manner that she did.
NBC has been vindicated in its belief by the High Court setting aside her legally incomprehensible and factually incorrect ruling, and her so-called default determination, in the matter of M Tom v PSSPF & NBC.
PSSPF board chair Jonathan Mort comments:
It is correct that NBC gave notice to the fund in a letter dated 14 Oct 2009 that it (NBC) was terminating its relationship as administrator with the fund. What I do not understand, however, is that the fund sent a letter to NBC dated 16 Oct 2009 advising NBC that it (the fund) was terminating its relationship with NBC as administrator.
Perhaps the two letters crossed in the post. But NBC is correct it was not fired at that time by the fund -- because the fund then had no lawfully constituted board to do this --and that the notice of termination was given by NBC.
NBC subsequently took the position with the current board that, as there was no lawfully constituted board in office when it had given notice of termination, the notice was of no effect and could be withdrawn. It was pointed out to NBC that, in terms of the administration agreement, it was the act of giving notice, not the acceptance, which terminated the relationship.
At least until 21 Jan 2010 NBC was maintaining through its attorneys that the administration agreement had not been terminated. It refused to hand over to the fund the data and records which were the funds property.
It s simply incorrect that NBC was never threatened with legal action for refusing to hand over the data and records of the fund. A letter threatening such action, dated 18 Jan 2010, was written by me to the NBC attorneys.
With regard to payment of the final fee due to NBC, the fund is certain that that fee was incorrectly calculated because it was based on an estimated membership. The fund will recover the overpayment from NBC once the membership numbers have been audited.
It is correct that, once the fee was paid, NBC was cooperative in the transfer. But the fund does not accept that, until the actual termination happened, NBC had carried out all its responsibilities as it should have done in terms of the administration agreement.
As a fact, the fund has had to deal with more than 60 000 unpaid withdrawal claims which were not settled by NBC at the time of termination. The fund is still updating records which should have been updated during NBCs tenure. And there were over 200 complaints before the Adjudicator to which NBC had not responded, as it was supposed to, on behalf of the fund.