In more than five years, only two employers have been found guilty of not paying the pension fund contributions of their workers.

This was revealed by Justice & Constitutional Development Minister Mmamoloko Kubayi in response to a parliamentary question. 

The Citizen reports that MKP MP Brian Molefe requested information about the number of criminal cases involving employers withholding pension fund contributions that had been investigated and handed over to the NPA for prosecution from March 2020 to January 2024.

Kubayi said: 'Since 2019, four cases were prosecuted and proceeded to trial stage, two of which were finalised since March 2020.’

Kubayi confirmed that two employers were subsequently convicted. 

‘One of the accused was also charged with fraud in addition to the contravention of section 13A of the (Pensions Fund) Act.’

The Financial Sector Conduct Authority (FSCA) has been monitoring employer compliance with pension fund contribution payments and has observed a rising trend of defaults.

In November 2024, the FSCA published a list showing that thousands of employers were in arrears. As of 31 December 2023, a total of 7 770 employers had failed to make pension fund contributions, contravening the Act. The total outstanding amount was R5.2bn.

The issue is particularly severe in municipalities, with 58% of SA’s 257 municipalities failing to meet their pension fund obligations. 

These 149 municipalities collectively owed R1.4bn to the  Local Authorities Pension Fund. The FSCA has warned that withholding contributions after deducting them from employees’ salaries is a serious offence that could amount to theft or fraud.

There are 130 cases opened against companies that have failed to pay over their employees’ pension contributions, according to the FSCA.

Additionally, officials from three Northern Cape municipalities – Kai !Garib, Renosterberg and Kamiesberg – were arrested for the non-payment of contributions.

Full report in The Citizen

See also full report in The Mercury