Pension Funds Adjudicator Lebogang Mogashoa has condemned the Mineworkers Provident Fund for its inadequate response to a deceased member's death benefit claim, highlighting the legal obligations of pension funds to act promptly.
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Pension Funds Adjudicator Lebogang Mogashoa has sharply criticised the Mineworkers Provident Fund for what he described as an unacceptably sluggish response in processing a deceased member’s death benefit, saying the fund failed in its legal duty to act urgently and proactively.
“The fund’s response paints an image of passiveness, reactivity and lethargy,” Mogashoa said in his determination.
The ruling relates to delays in the allocation and distribution of a death benefit worth R458,358.59 following the death of a Mineworkers Provident Fund member on July 27, 2020.
The complainant, who said she was married to the deceased in a customary marriage, told the Adjudicator that she only managed to formally register the marriage after his death. She said the deceased left behind three children from previous relationships, as well as one child they had together.
She lodged a complaint over what she described as an excessive delay in the payment of the death benefit, saying repeated attempts to obtain updates had yielded little response and that the employer had been uncooperative in following up the matter.
In response, the fund said it was notified of the member’s death on 31 August 2020 and that the section 37C investigation process began immediately. However, it said its records reflected that the deceased was still marked as alive by the Department of Home Affairs, and it had been advised to wait for that status to be updated.
The fund also said it requested supporting documentation from the complainant and maintained that vital information from potential dependants remained outstanding.
But Mogashoa rejected the explanation, pointing to long periods of inactivity by the fund.
In his ruling, he noted that although the fund became aware of the death in August 2020, it only requested basic documentation six months later, on 2 March 2021.
Its subsequent attempts to progress the matter were irregular and infrequent, with contact made only in June 2021, March 2022, September 2022, February 2023 and July 2025.
“Over five years, the board’s lethargic approach amounted to little more than a handful of phone calls, leaving dependants prejudiced and potentially denied timely access to benefits that were rightfully theirs,” Mogashoa said.
He emphasised that section 37C of the Pension Funds Act places a clear obligation on pension fund boards to trace and investigate dependants when a member dies actively.
“The board of a fund has to be proactive in locating the dependants. The board was not entitled to wait for dependants to come forward simply and should actively investigate claims in terms of section 37C,” he said.
Mogashoa found that the fund’s failure to carry out its statutory responsibilities had caused undue hardship to the complainant and other beneficiaries.
As a result, he ordered the Mineworkers Provident Fund to pay interest of 15.5% on top of the death benefit for the unreasonable delay.
The ruling serves as a strong warning to pension fund trustees that delays in administering death benefits can carry financial consequences, particularly where beneficiaries are left waiting years for funds to which they are entitled.
PERSONAL FINANCE