Retirement fund fracas splits Amcu

Shafted: Amcu miners’ retirement savings have become the latest site of the union’s internal struggles, with Amcu president Joseph Mathunjwa appointing himself to chair the fund. (Delwyn Verasamy)

Shafted: Amcu miners’ retirement savings have become the latest site of the union’s internal struggles, with Amcu president Joseph Mathunjwa appointing himself to chair the fund. (Delwyn Verasamy)

The battle for control of the Association of Mineworkers and Construction Union (Amcu) has shifted to its members’ retirement savings. And Amcu president Joseph Mathunjwa has appointed himself chairperson of the union’s new fund, the Igula Umbrella Provident Fund, despite the trustees electing his deputy, Sanele Myeza, to the position.

Amcu has 250 000 members and represents the majority of workers in the platinum and coal mining sectors. It is the second-biggest union in the gold sector, which is dominated by the National Union of Mineworkers.

READ MORE: Mathunjwa purges rivals in shake-up

But Amcu has been plagued by internal battles over transparency and the apparently dictatorial leadership style of the charismatic Mathunjwa.

Mathunjwa and Myeza have been at odds because of the deputy president’s increasing support in the union and calls for a national congress to elect new leaders.

Last week the Mail & Guardian reported on a purge of Myeza’s supporters from the union, allegedly for expressing their dissatisfaction with Mathunjwa.
Since then, another Amcu official in Mpumalanga, Tlou Kwenait, has been dismissed for gross insubordination, which was conveyed in a letter.

At stake is not only the battle for control of the union members’ monthly subscriptions but also their retirement savings reportedly worth more than R7-billion which the union has demanded should be shifted to the Igula fund.

“Without going back to [the Amcu] NEC [national executive committee] for a fresh resolution, Mathunjwa has yet again used his bulldog tactics and appointed himself as chairperson,” one of the trustees of the Igula fund said. “This will not pass the test with the FSCA [Financial Sector Conduct Authority] and is against the rules of the fund.”

The rules state that the chairperson of the Igula fund must be elected from the trustees and Amcu’s submissions to the FSCA show that Mathunjwa is not a trustee — and appointed himself chairperson.

Myeza was elected chairperson of the fund after Amcu seconded its treasurer Jimmy Gama, Myeza and Amcu Limpopo secretary Neo Mangke to serve as the trustees, the records show.

According to the FSCA records, Igula is administered by financial services group Alexander Forbes while EOH is registered as its investment consultant, with EOH managing director of employee benefits Michael Woods listed as its principal officer.

“To date the [Igula] fund has not submitted annual financial statements although it received preliminary registration in 2016,” a former senior executive of the FSCA, who requested anonymity, said this
week.

The FSCA requires statements to be submitted every six months.

Amcu’s submissions on the Igula fund to the FSCA also confirm that it has not submitted the statements.

In a 2015 newsletter, Gama explained that the Igula fund was created “as a result of the huge outcry from our members on unpaid benefits from their existing funds”.

“The Igula Umbrella Provident Fund will play a meaningful role in ensuring that members’ benefits are protected and claims paid timeously,” he wrote.

Woods and Mathunjwa share a long history; Woods helped to manage the employee benefits fund of BHP Billiton, now known as South32, when he was general manager of Amadwala group benefits in Witbank, where Mathunjwa was employed.

Amcu’s bid to have its members’ retirement savings moved from investment funds chosen by the mining companies to Igula has been described by gold mining insiders as “one of the most contested discussions” happening at the platinum and gold mines.

The latest gold wage negotiations with AngloGold Ashanti, Harmony Gold, Sibanye-Stillwater and Village Main Reef started last week and are happening simultaneously under the guidance of the Minerals Council, formerly the Chamber of Mines, which represents all the companies.

The council’s spokesperson, Charmane Russell, confirmed that the companies had received a demand to transfer the retirement savings of Amcu members to the union’s new fund but she said this would be negotiated at a company level after the implementation of the wage deal.

The platinum companies received the same demand three years ago but refused to do it because of reservations about Igula’s compliance with the FSCA.

The Labour Court this month dismissed Amcu’s application to force Anglo American Platinum (Amplats) to transfer its members’ savings to Igula.

Judge Andre van Niekerk found that Amplats was duly empowered by its employment contracts to select its preferred retirement funds and Igula had failed to outperform Old Mutual.

Amplats spokesperson Mpumi Sithole said Igula was rated the lowest out of a range of different funds evaluated by external and independent auditors.

“We believe that our employees’ investments are best protected within the context of a well-established and managed umbrella fund.”

Impala Platinum is being equally cautious after the four trustees of its Implats Worker Provident Fund were arrested during a sting operation by the Hawks for soliciting bribes of more than R2-million from a life insurance company in 2016 “for protection”.

The case is continuing but all of Amcu’s shop stewards at the mine have been replaced, said Impala spokesperson Johan Theron.

“There’s been a change on the Amcu side and that has set those processes [to negotiate a transfer to Igula] back somewhat. So there hasn’t been any meaningful progress.

“We have got a worker pension fund we have created with the workers. It is managed by independent fund managers like Allan Gray and Old Mutual,” Theron said.

He said Impala had reservations about the Igula fund.

READ MORE: Amcu workers too scared to strike

“As much as we are willing to listen to these good reasons, we are not going to put people’s retirement savings at risk.

“Whatever happens in future will have to follow the letter of the law,” he said.

Former managing director of the Alexander Forbes retirement funds division, Andrew Crawford, described the Igula fund as a case of bad governance.

“It doesn’t meet any standards of corporate governance. The two fundamentals of corporate governance is transparency and a balance of authority, which it doesn’t have,” Crawford said.

Amcu did not respond to questions about the Igula fund and its trustees or to questions about the leadership tussle between Mathunjwa and Myeza.

Client Media Releases

NWU hosts successful press club networking forum
Five ways to use Mobi-gram
MTN gears up for Black Friday sale promotion