Five years needed for ‘rotten’ fund probe
JOHANNESBURG - Six forensic firms will need at least five years to unravel the depths of financial mismanagement, neglect, corruption and "rottenness"- as employment and labour minister Thulas Nxesi puts it – at the heart of the Compensation Fund.
Nxesi said in a written Parliamentary answer this week that a panel of six forensic investigation firms have been appointed and contract negotiations had been concluded for a probe into the fund.
The investigation was ordered by the Standing Committee of Public Accounts (Scopa) in May.
"Firms will be commencing with the work from January 2022, though the initial planning is being conducted in December 2021," Nxesi said in the reply.
The government-run fund is financed by employers and aims to pay compensation to sick and injured workers, or the families of employees who have died on the job.
The fund however has faced large-scale criticism, including about lengthy delays in paying out claims, poor leadership and a decade-long stretch of poor audit outcomes, including findings of irregular, fruitless and wasteful expenditure, which Scopa says highlights a "total collapse of internal controls."
Nxesi told Scopa in May that the fund is "rotten to the core."
Department spokesperson Musa Zondi said the six firms that will conduct the investigation are SNG Grant Thornton/ TSF Africa Forensics, Abucus, Nexus Forensic Services, Stone Turn Group South Africa, BDO/Hidden Links and Bowman Gilfillan.
The forensic investigations will focus on several areas:
Medical claims transactions Pensions, temporary disability, permanent disability, constant attendance allowance and funeral expenses transactions
Employer services (including employer registration and accounts receivables) Investments
Cyber security
Conflict of interest among
Compensation Fund employees
Accounts payable and supply chain management – FIN24.