IOL 14 June 2019
Parliament – The unprecedented parliamentary exodus of former ministers who were overlooked by President Cyril Ramaphosa when he assembled his Cabinet, has lifted a lid on some of the lucrative benefits awaiting ministers when they leave office.
On Thursday, former labour minister Mildred Oliphant became the 9th ANC MP to resign.
She occupied the post since her appointment in 2010 by former president Jacob Zuma.
Other MPs who have left their seats in the National Assembly include former minister of women in the presidency Bathabile Dlamini, former energy minister Jeff Radebe and former social development minister Susan Shabangu.
Speaking to Gauteng radio station Power FM, Oliphant said more former ministers would continue as ordinary MPs if they did not lose some of their perks as a consequence.
“I know what the public may say, but why should I consider taking the packages rather than to continue to serve? The public must understand that we have a responsibility for our families, and if you look at the benefits if I had to stay in Parliament, looking at my last salary, I will be forfeiting around 50% to 55% of the benefits,” she said.
According to the Political Office Bearers Pension Fund (POBPF), which provides retirement benefits for ministers, MPs and MPLs, the loss-of-office gratuity counted among the top lucrative benefits eyed by former ministers.
Eric Potgieter, an adviser and consultant to the POBPF, said the benefit was paid to political office bearers who left office after serving more than five years and – unlike the pension payouts – was affected by whether or not former ministers stayed on as MPs.
“The gratuity amount is four months’ pensionable salary for each five-year period – so a member who leaves office after completing two terms (10 years) would get a loss-of-office gratuity equal to eight months’ pensionable salary, where pensionable salary is 60% of the total package applying at the time the member leaves office,” Potgieter said.
This meant that those who left public office as members of Cabinet would receive a larger gratuity than those who left office as an ordinary MPs.
The current annual total package for ministers is R2401633 or R200136 a month, while MPs earned R1106940 a year, or R92245 a month.
With pensionable salaries for ministers at R120081 in the 2018/19 financial year, Radebe, who had been in the Cabinet since 1994, is set to get around R2.5million from the loss-of-office gratuity alone.
Former ministers must, however, resign before they receive their first salary this month as MPs to qualify.
Potgieter said pension fund benefits, which comprise 30% of all members’ pensionable salaries, were, however, dependent on contributions of ministers over the years, including as MPs, and they would not be affected by their stay in the National Assembly.
“In our understanding, therefore, a former member of Cabinet who continues as an ordinary MP would only lose out because the loss-of-office gratuity would be based on the ordinary MP’s pensionable salary and not on the minister’s salary,” Potgieter said.
“The pension fund benefits would not reduce when someone leaves Cabinet after the election and becomes an ordinary MP.”
Former ministers were also allowed to take one-third of their retirement benefit when they left office, with the balance of the money being used to buy pensions.
Political analyst Professor Somadoda Fikeni said the spate of resignations made a mockery of their claim to be prepared to serve.
“The notion that they are prepared to be deployed anywhere by their organisation may no longer be found to be believable,” Fikeni said.
Despite concerns that the resignations would harm institutional memory and experience in Parliament, Fikeni said the departure of the ministers could be a blessing in disguise.
“This could be a necessary new start because some of these former ministers would have vested interests in the departments they led and may want to protect their legacies when they are in Parliament,” he said.