Lize de la Harpe, Senior Legal Advisor at Sanlam

Earlier this year, during his address at the Pension Lawyers Association annual conference held in Sandton, the new Pension Funds Adjudicator presented some interesting statistics. He  specifically referred to the current state of arrear retirement fund contributions as a “crisis” in our industry. In fact, he explained, the R7.2billion in arrear contributions accounts for 51% of all complaints received by OPFA.

This prompted the Adjudicator to seek advice from senior counsel on the optimal application of section 30J of the Pension Funds Act, 1956 (the Act) specifically the utilisation of subpoenas and summonses where funds and/or administrators refuse to cooperate with the Adjudicator on issues and complaints.

On 12 August 2026 the OPFA published Draft Guidelines on the exercise of powers by the Adjudicator under section 30J(3) of the Act for public comments.

Let’s first recap.

Obligation to pay retirement fund contributions – section 13A of the Act

Section 13A of the Act, read together with FSCA Conduct Standard 1 of 2022 (RF), imposes a duty on the participating employer to calculate and pay over to the fund the contributions, payable in terms of the rules, on a monthly basis and to furnish to the fund with certain prescribed information. Contributions are payable no later than 7 days after the end of the month for which  are payable. If the contributions or any part thereof is not paid timeously, interest will be payable by the employer to the fund at a rate prescribed in terms of the Act.

In terms of section 37(1) of the Act, any person who contravenes or fails to comply with section 13A, is guilty of an offence and liable on conviction to a fine not exceeding R10 million or to imprisonment for a period not exceeding 10 years, or to both such fine and such imprisonment.

Most notably, the non-payment or late payment of contributions by an employer could result in personal liability for certain individuals within the employer and constitutes a criminal offence.

If the employer fails to notify the fund of the identities of the applicable individuals, all the directors of the employer, will be personally liable for the non-payment or late payment of contributions.

The arrear contribution “crisis”

According to recent FSCA statistics, the total arrear contributions are estimated to be R8.33 billion, affecting approximately 590 000 retirement fund members. This represents an increase of R1.04 billion (14.2%) from the R7.29 billion reported as at 31 March 2025.

Current data suggests that the severity of arrears is increasing. The implementation of the Two Pot Retirement in September 2024 (which allows members to make a withdrawal from their savings component once a tax year) further exposed the failure of employers to pay pension contributions to funds.

In his address at the conference (mentioned above), the Adjudicator specifically noted a determination his office had recently issued by default. In essence, the complainant was unhappy that the fund didn’t respond to his queries relating to a delay in paying out a benefit. The fund also ignored the Adjudicator’s request for information – so did the Principal Officer and the Chairperson of the fund in question.

This prompted the Adjudicator to look at why exactly a fund would be so brazen and he concluded that funds appear to be under the impression that there would be no legal consequences for them ignoring the member and/or the Adjudicator.

This prompted his office to obtain a senior counsel legal opinion on the following:

1. The OPFA is a statutory ombud scheme established under section 30B of the Act.
2. In terms of section 30J(3) of the Act, the Adjudicator is empowered to apply certain sections of the Commissions Act, 1947 with the necessary changes for the purposes of investigating a complaint. It states that the Adjudicator may follow “any procedure” which he/she may consider appropriate when conducting an investigation, including procedures in an inquisitorial manner.
3. The question posed to senior counsel was as follows – can the OPFA issue a summons and subpoenas in terms of the Commissions Act against uncooperative funds and administrators?
4. The answer is yes: section 30J specifically states that certain provisions of the Commissions Act, 1947 will apply mutatis mutandis, meaning it will apply with the necessary adjustments (see Chevron v Nkambule, S v Mhlungu).

As such, the Adjudicator can indeed leverage the Commission Act to issue a summons/subpoena against funds/administrators who refuse to cooperate with the OPFA.

Draft Guidelines

The Draft Guidelines now published aims to clarify procedural matters when the OPFA invokes the provisions of the Commissions Act and specifically addresses the following:

• The process for issuing and serving summonses including the circumstances in which a summons may be issued and the information that should be included,
• The obligations of persons who are summoned to appear before the Adjudicator or produce material relevant to an investigation,
• The procedure to be followed during proceedings, and
• Consequences of non-compliance with a summons or failure to co-operate with proceedings, and the possible enforcement steps to address non-compliance.

In essence, the Draft Guidelines confirm that a summons may be issued by the Adjudicator where he reasonably considers it necessary for the effective investigation and determination of a complaint, which summons will be in a prescribed form.

This is not limited to instances where a fund refuses to provide information to the OPFA or complainant, but also includes instances where it has has failed to provide an adequate or complete response to a complaint and where a person has repeatedly requested extension of time without adequate justification and, despite being afforded a reasonable opportunity to do so, has failed to provide the required information or evidence, or has otherwise delayed or impeded the investigation.

What is particularly notable is the following:

a) Section 30K of the Act applies to these proceedings, meaning a person appearing before the Adjudicator is not entitled to legal representation, subject to certain exceptions.

b) A person who has been summoned and who, without sufficient cause, fails to attend or fails or refuses to provide the information needed may be guilty of an offence in terms of section 6 of the Commissions Act, as incorporated by section 30J(3) of the Act.

c) A person who interferes with the process in any way may be guilty of an offence in terms of section 30V of the Act.

d) Where a person fails to comply with a summons, the Adjudicator may:

1. continue with the investigation on the basis of the information available (if fair in the circumstances);
2. refer the matter to the appropriate authority for investigation or prosecution in terms of the Act, the Commissions Act or any other applicable law;
3. seek appropriate relief from a competent court; or
4. take any other lawful step available under the Act, the Commissions Act or any other applicable law.

e) Lastly, the Adjudicator may issue procedural directions to facilitate the implementation of these Guidelines.

Conclusion

The object of the Board of Trustees as set out in section 7C(1) of the Act is to direct, control and oversee the operations of a fund in accordance with the applicable law and rules of the fund.

Section 7C(2) of the Act states that in pursuing the object of the Board, the trustees must take all reasonable steps to ensure that the interests of members in terms of the rules of the fund and the provisions of the Act are protected at all times, must act with due care, diligence and good faith, and – importantly – have a fiduciary duty to members and beneficiaries as well as to the fund itself.

Further duties as set out in section 7D of the Act includes a duty to ensure that adequate and appropriate information is communicated to the members and beneficiaries informing them of their rights, benefits and duties in terms of the rules of the fund.

ENDS