Unibank Provident Fund was rapped over the knuckles by the Pension Funds Adjudicator this week and ordered, with immediate effect, to pay the retirement benefit due to a Benoni pensioner four years ago, after several changes of administrator resulted in the loss of the woman’s membership record.
The fund told Beulah Bonugli it could not find any record of her benefit or that she was a paid-up member of the fund, after it changed administrators several times in the past eight years.
Bonugli resigned from Union Finance in January 2000 and left her retirement benefit in Unibank Provident Fund.
Bonugli retired from the fund in June 2007 and asked for her retirement benefit to be paid out. But the fund was unable to find her membership records.
In October 2007, Bonugli complained to the Pension Funds Adjudicator about Unibank Provident Fund’s refusal to pay out her benefit. The fund’s current administrator, Absa Consultants & Actuaries, and its previous administrators, Investec Employee Benefits (now owned by Liberty) and Lekana Employee Benefits (now owned by Momentum), were also named in the complaint.
Liberty conducted an investigation and found that paid-up members and voluntary contributions had not been included in the list of members transferred to Absa Consultants & Actuaries. “Liberty was the only company who did a full investigation and figured out that an error had been made somewhere along the line,” Elmarie de la Rey, the Acting Pension Funds Adjudicator, says.
She says it is uncertain which administrator dropped the ball. Unibank Provident Fund used the following administrators: Fedsure, Investec Employee Benefits, Lekana Employee Benefits and Absa Consultants & Actuaries.
Liberty calculated that Bonugli’s benefit had been R235 885.53 on March 1, 2002, when Investec Employee Benefits handed over administration of the fund to Lekana Employee Benefits.
Liberty forwarded a corrected list of members, which included Bonugli and 11 other paid-up members, to Absa Consultants & Actuaries on February 12, 2009.
But Absa Consultants & Actuaries disputed the value of the funds transferred to it in March 2002 and asked Liberty to provide proof of payment specifically in respect of Bonugli’s retirement benefit. Liberty told De la Rey that it could not provide this proof, because Absa Consultants & Actuaries was responsible for the maintenance of member records and the fund’s benefits had been transferred in bulk.
In her ruling, De la Rey says although a fund may delegate some of its functions to a service provider, it has a duty to oversee the service provider.
“The duty to keep proper records in respect of members is of critical importance, as these are used to determine the benefits of members. Any failure to maintain proper systems and to keep proper books and records will prejudice members,” she says.
Bonugli’s status as a paid-up member of Unibank Provident Fund was confirmed by Liberty in emails dated March 6, 2009 and October 6, 2010, De la Rey says.
“Bonugli remained a paid-up member of the Unibank Provident Fund despite several changes in administrators since January 2000 and is entitled to receive payment of her benefit. She is currently 63 years old and qualifies for an early retirement benefit.”
De la Rey ordered Unibank Provident Fund to pay Bonugli her early retirement benefit, together with all investment returns from January 2000 to the date of the ruling, within two weeks.
TO CONTACT THE ADJUDICATOR
The Acting Pension Funds Adjudicator is Elmarie de la Rey.
Telephone: 087 942 2700
Fax: 087 942 2644
Post: PO Box 651826, Benmore, 2010
Email: [email protected]
Website: www.pfa.org.za