Nineteen municipalities across South Africa have failed to pay R1.79 billion in pension fund contributions, leaving thousands of workers’ retirement savings at risk.
The parliamentary standing committee on finance has flagged the growing crisis, with Kopanong Local Municipality in the Free State, which includes towns such as Trompsburg, Bethulie, Edenburg, Garipe Dam, Fauresmith and Jagersfontein, owing the largest amount at R378 million.
Masilonyana Local Municipality, also in the Free State, owes R156 million in unpaid contributions. The two provinces – Free State and North West – account for 79.4% of the total debt.
Workers’ futures at stake
The committee warned that continued non-payment threatens the retirement security of municipal employees who depend on these contributions for their future.
Committee chairperson Dr Joe Maswanganyi said parliament will engage government departments, affected municipalities and organised labour to find solutions.
“This is an act of criminality, and someone must be held accountable,” Dr Maswanganyi said. He stressed that those responsible should face legal consequences.
Government intervention planned
Maswanganyi announced that he will write to the minister of finance and the minister of cooperative governance and traditional affairs to clarify what interventions are underway to resolve the crisis.
The committee will work with its legal services unit to send letters to each municipality demanding answers within set deadlines.
Municipalities must explain how they plan to settle outstanding contributions and what disciplinary action they are taking against officials responsible for the non-payment.
Parliament to summon municipalities
Maswanganyi proposed calling all 19 municipalities to a single meeting where they must account to parliament directly.
The committee will also meet with trade unions representing municipal workers when parliament reconvenes next year to discuss possible solutions.
“We were elected by the public, which has full confidence in us, and we can’t let them down,” Maswanganyi said.
The planned engagements aim to recover outstanding contributions, strengthen accountability and ensure municipalities meet their obligations to pension funds and employees.
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