Mungo Soggot
The Northern Province has quietly started repaying most of the 92 000 pensions and disability grants it froze last year on the grounds it wanted to check recipients’ bona fides.
The province’s decision to restart the pay-outs comes after it was hit with scores of lawsuits. These included a class action which asked the high court to strike down the decision that led to the move, and requested the court to supervise the province’s disbursement of pensions.
But although the provincial government is now also paying out arrears to many of the unfortunate beneficiaries concerned, it is refusing to pay them interest on the arrears.
The Legal Resources Centre (LRC), which is representing dozens of indigent people affected by the province’s bizarre freeze, says the decision to withhold interest payments could have saved it more than R10-million, assuming an average monthly pay-out of R500. It says the class action is still continuing in relation to the province’s failure to pay interest.
Advocate Nick de Villiers of the LRC says the province, which informed him of the decision to start repaying many of the grants last week, had to be congratulated for rectifying the problem.
But he also says it is outrageous that the province had frozen payments while investigating the alleged irregularities and that it was now apparent there was little basis for its moratorium.
“The fallacy of the province’s approach is shown by its own decision to start repaying.”
The province stopped the grants last February, saying it believed at least two-thirds of the payments were going to “ghost pensioners” who were stripping the state of R44,5-million a month.
A department representative said at the time that those hit were generally people with “incomplete files”.
The province has consistently defended the move. This week its acting superintendent general, Moffat Mogone, said: “We had reasons for all of them.” He denied that, with hindsight, the province acted wrongly.
Mogone said about three-quarters of the affected people were now getting their money and that the clean-up operation had been necessary to appease the auditor general.
He confirmed that interest was not being paid on the arrears, adding that “the issue of interest is something which needs debate”.
But Mogone dismissed the suggestion that the province had saved money from the exercise, adding that the province was not a “private company”.
It is unclear exactly how many “ghost pensioners” were uncovered in the probe. The province informed the LRC that only 9 000 of the 92 000 pay-outs had been cancelled. But of the 9 000, only a fraction were “ghosts”, the majority being people who had not submitted themselves to the province for vetting.
De Villiers says many of those who had not yet been repaid were entitled to their grants and that the LRC, together with the Pietersburg branch of Lawyers for Human Rights, was pushing those cases to court.
He says he recently issued 63 summonses for arrear payments and interest. “This is a clear indication that further savings are being made between the cracks.”
De Villiers said nearly all of those affected relied on the pay-outs as their sole source of income. “It would be interesting to find out where the saved money has gone,” he added.