Durban - KwaZulu-Natal Finance MEC Francois Rodgers has warned municipalities that failing to pay over pension fund contributions on behalf of employees to pension funds was illegal and a violation of workers' rights.
The warning from Rodgers came after it emerged that the Okhahlamba Local Municipality in northern KZN had outstanding contributions to a pension fund that allegedly exceeded R11.4 million as of December 2024.
In a statement, the KZN Treasury said Rodgers had issued a stern warning to municipalities about the matter.
“Failure to pay over pension fund contributions is inconsistent with our vision of building a capable, ethical, and developmental state that cares deeply about workers’ rights. In fact, this practice can be characterised as fiscal delinquency of monumental proportions,” said MEC Rodgers.
He added that the Municipal Finance Management Act (MFMA) is clear on the fiduciary duties of accounting officers within municipalities.
He said the MFMA states that the accounting officer of a municipality commits an act of financial misconduct if he or she deliberately or negligently fails to comply with a duty imposed by a provision of the Act on the accounting officer of a municipality.
Against this backdrop, Rodgers encouraged the Okhahlamba Local Municipality to launch consequence management proceedings against implicated accounting officers for failing to pay over pension fund contributions to the relevant pension funds.
The KZN Treasury said Rodgers will be monitoring the municipality's response to his call and will not hesitate to intervene where necessary by ensuring the implementation of consequence management and accountability.