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Complaints backlog a major challenge for PFA

25 October 2011 Gareth Stokes
Gareth Stokes, FAnews Online Editor

Gareth Stokes, FAnews Online Editor

The Pension Funds Adjudicator (PFA) is a specialist tribunal that makes binding and final determinations in pension fund complaints submitted to it in terms of the Pension Funds Act. And the Office of the PFA (OPFA) was set up to ensure a procedurally fair, economical and expeditious resolution of complaints in terms of the Act, by: ensuring that its services are accessible to all, investigating complaints in a procedurally fair manner and reaching a just and expeditious resolution of complaints in accordance with the law. (The above definition is courtesy the PFA).

Waiting for an update on pension funds complaints handling

I’ve been waiting for some time for the Pension Funds Adjudicator (PFA) 2010/11 Annual Report. A while back I asked the organisation’s public relations company to drop me a line as soon as it was available. It must have slipped their mind, because when I visited http://www.pfa.org.za/ this week I found the report gracing the appropriate web page. Why was I so keen to see the latest report?

I wanted to get a feel for how the OPFA was progressing on its massive complaints backlog. The OPFA has been struggling to reduce the number of complaints on its “books” for many years now. In their 2008/9 Annual Report they undertook to close all cases dating back to 2005 and 2006 by no later than 31 March 2010. Last year this time, in their 2009/10 Annual Report, the PFA commented: “Although good progress was made, this goal was unfortunately not reached!” The outfit seemed to be drowning under the weight of pension complaints and missed their self-imposed target despite making solid progress over the period.

Unpacking the pension complaints legacy

One of the challenges the PFA wrestled with in its 2009/10 year was to sort valid cases from the reams of invalid data captured on the OPFA system. The PFA explains: “A cursory examination of the system indicated that a number of files were duplicated, files finalised were not closed on the system, and the system itself double-counted complaints according to complainant and respondent.” One wonders how, in the 21st Century, South Africa struggles so with legacy issues in computer systems (think municipal billing as another example!) After scrutinising the 2009/10 report it appeared the office’s 54 (then) staff would have their work cut out. Because despite closing 6 642 cases in the 12 months to 31 March 2010, a “new” case load of 6 188 cases left a balance of 8 171 cases at the start of FY2011. What happened in the 12 months to 31 March 2011?

A complaints resolution impasse

The latest period was a difficult one for the OFPA. “Apart from dealing with the unexpected death of Mr Charles Pillai [the previous PFA], the OPFA has had to deal with several challenges around compliance with the provisions of the Public Finance Management Act 1 of 1999 and Treasury Regulations, the implementation of new policies, and outdated IT and case management systems,” notes Dr Elmarie de la Rey, the acting PFA. Dr De la Rey, a seasoned lawyer with substantial pension fund law experience, took the reins at the OPFA from 15 October 2010. In her opening letter to the Annual Report she said that “the issue of turnaround times in dealing with complaints and the backlog of complaints to be finalised remain a matter of concern!”

The flood of new cases continued through 2010/11, while the office struggled to reduce its “old case” backlog. It is hoped the very old cases, dating back to pre-January 2009 will all be addressed by November this year, thanks to the formation of a dedicated team in the Adjudication Unit. A new case management system has also been introduced to speed up the general complaints resolution process. New cases for 2010/11 numbered 6 220, almost offset by the 6 123 settled complaints (894 by conciliation, 1 430 by determination and 3 799 without). As a result the OPFA enters the 2011/12 reporting period with a slightly heavier 8 268 cases.

The good news from the 2010/11 period was a significant decline in the number of determinations taken on review to the High Court in terms of section 30P of the Act. Dr De la Rey believes there is a new found respect and confidence in the office and its determinations, and concludes: “The OPFA remains committed to fulfilling its mandate to ensure a procedurally fair, economical and expeditious resolution of complaints in terms of the Pension Funds Act, 24 of 1956.”

Editor’s thoughts: The OPFA is concerned over the duration of many of the complaints on its books. It is, in our view, unacceptable for a pension fund member (or perhaps the executor of the member’s estate) to have to wait five years for complaint resolution… Have any of your clients experienced undue delays in resolving their complaints through the OPFA? Please add your comment below, or send it to gareth@fanews.co.za

Comments

Added by Quicks, 25 Oct 2011
The PFA needs to do 2 things which should not be too difficult: Firstly, vet complaints - many complaints are frivolous and timewasting. We once had a complaint be a member who was paid his benefit in the 90's. He had a dream in 2007 and in the dream, a woman came to him and said he was not paid his ful benefit. I kid you not. Secondly, stop referring complaints for conciliation without first vetting the complaint - we get called in to conciliation meetings on some of the silliest complaints, as a matter of course - it seems no-one first considers whether the claim could possibly have any substance. Otherwise, the PFA does great work.
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