R1.5bn earmarked for former mineworkers with lung disease sits idle

R1.5 billion is lying idle, waiting for 105,000 former mine workers with lung disease to be found so the cash can be given to them.

The workers’ details were not captured or were lost as South Africa’s two dysfunctional workers’ compensation funds dissolved in chaos.

 Some of the workers last worked in mines in the 1980s and have left the country.

The latest auditor-general’s report has highlighted major financial and governance troubles in the compensation funds, which are meant to help employees who get injured at work.

Trade unions have called for a speedy resolution of problems plaguing the funds – one of which has not submitted financial statements since 2010.

The Health Department’s Compensation for Occupational Diseases in Mines and Works Fund compensates occupational lung diseases in miners and ex-miners. It is governed by the Occupational Diseases in Mines and Works Act.

The compensation fund operated by the Department of Labour is governed by the Compensation for Occupation Injuries and Diseases Act and is for non-mine workers.

In a report this week, Auditor-General Kimi Makwetu tells a tale of financial accounting and management in disarray.

Makwetu said the Health Department’s fund had not submitted financial statements since 2010-2011, and attributed this to a lack of skills and capacity and a lack of appropriate internal controls and accounting systems.

In August, Health Minister Aaron Motsoaledi told parliament about 100,000 claimants who remained unpaid, with about 45% of these claims dating back to 2000.

Discussions are under way between the departments to integrate the systems to provide a comprehensive, uniform compensation dispensation for all occupational injuries and diseases for all workers. The labour compensation fund has been dysfunctional for years. Auditors were unable to express an audit opinion for the fourth consecutive year. The Labour Department’s compensation fund incurred R404-million in fruitless and wasteful expenditure in the past financial year.

Trade union Solidarity said the compensation fund’s new electronic system was unable to deal with 200,000 claims submitted annually.

The union’s occupational health and safety representative, Hanlie van Vuuren, said they had noticed chronic low staff morale.

She said there was a time when there was a complete standstill at the fund in worker compensation, resulting in injured workers unable to get by as their employers were not obligated to pay them a salary.

“You now have a person who has to support his family, not getting what is due to them in time, doctors refusing to treat them because of uncertainty that they will be paid. We have a member who had an amputation after an injury on duty. Four years later they are still waiting for their payouts,” she said.

National Union of Mineworkers’ occupational health and safety officer, Erick Gcilitshana, said the biggest problem with the health department’s mines and works fund was the messy database.

“In some cases files are not captured on the system and just dumped in the storeroom. When the worker makes follow ups, it would take up to six months to excavate the file,” Gcilitshana said.

Health Minister Aaron Motsoaledi admits his department’s fund is in “turmoil”.

He said that in 1998 there was a decision that this fund be removed from the department and placed under the Department of Labour but the then labour minister Membathisi Mdladlana refused to accept it because it was in a mess.

“So you had a structure that was hanging. Labour refused it because it was in a mess, Health said the decision was that it must go to Labour and we are not taking care of it,” he said.

“We then appointed a chartered accountant [to head the fund] but messed up in a big way … there was corruption and we had to fire her and start all over again. So in all these years books could not be kept,” he said.

Motsoaledi said he appointed occupational health specialist Barry Kistnasamy, who found some files dating back to 1960.

“That means the data was there, nobody could audit it … he started with 200,000 files of workers to audit stretching back many years. Many had already left the mines and are from Botswana, Swaziland, Namibia and so on. He audited and found that 105000 of them needed to be compensated,” he said.

He said centres across the country had processed and paid out 12,000 claims. But there are still 500,000 files in need of assessment.

One thought on “R1.5bn earmarked for former mineworkers with lung disease sits idle

  • November 18, 2016 at 2:49 pm

    Mine workers should not be paid out. The volunteer to work in the mines, well aware of the hazards.That money can rather be spent on old age homes


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