Polmed Corruption


Media release – The Public Servants Association (PSA) has condemned government’s failure to properly fund the Statistics SA Council, which is by law required to promote and safeguard official statistics, and has warned that the situation poses a severe threat to the country’s stability.



MEDIA RELEASE: Stats SA Council: PSA condemns government’s double standards

DATE: 24 February 2020

The Council is threatening to resign if the agency is not provided with the necessary funding to allow it to execute its functions. Stats SA is the sole source of official statistics in South Africa. It consistently produces key statistics that allow the private sector, government, international agencies and other stakeholders to understand the society and economy, plan their work, and monitor progress. Stats SA data are critical in ensuring that national fiscal flows are appropriately directed, in line with the National Development Plan.

However, in 2015 Stats SA had R160 million stripped from its budget and a freeze on all posts was imposed by government. Both measures have remained in place do date. By early 2020, the situation reached crisis point. The vacancy rate climbed to almost 20%, placing an unreasonable burden on staff and infringing on their rights and interests as they are each expected to carry the workload of five other employees, resulting in excessive overtime.

Stats SA is not a ‘state capture’ bail-out candidate. The entity receives regular clean audits and enjoys widespread public trust. It is difficult to understand why a respected, reliable and important institution, that plays by the rules and is praised by the Auditor-General is not supported. The fact that government is willing to fund failing entities such as Eskom and SAA but refuses to properly fund the Council is a travesty. The PSA demands that government as a matter of urgency consults with all stakeholders, including labour, to resolve this crisis.

The insufficient funding has damaged Stats SA to the extent that products and surveys have had to be prioritised, and some value-adding items have been discontinued. This may have a negative impact on certain areas of the economy owing to a lack of information. In addition, the brain drain is a critical aspect that need to be addressed. Mechanisms should be put in place to curb this trend as it destined to have dire consequences for the country.

The PSA as a representative union of more than 240 000 public service employees, views this neglect of Stats SA’s as irresponsible. The PSA has called on the Minister in the Presidency, Mr Jackson Mthembu, to intervene as the resignation of the Council could be disastrous and pose a threat to the country’s stability.

The PSA will also consider legal remedies to protect the interests of the Union’s members at Statistics SA should this matter not be resolved amicably.




Feedback: Bargaining Forum meeting

Collective Agreement: New shift system
Parties are busy with negotiations on the new shift system. The collective agreement has not been finalised yet, and the task team will meet on a date to be confirmed for finalisation of the agreement. The PSA demanded that this matter be finalized.

Subsistence and travelling payments for international trips (S&T)
This matter was previously tabled by the PSA after receiving complaints from members about challenges experienced when withdrawing monies whilst on international trips. The employer reported that it has not received feedback from the CFO and feedback will be provided at the next meeting.

The policy task team could not meet owing to the unavailability of other members. The task team will meet on a date to be confirmed to discuss the following policies:

Placement Policy, Resettlement Policy, Funeral and Bereavement Policy, Record Management Policy, Bursary Policy, Acceptance of Gifts Policy, Recruitment and Selection Policy, and Skills Development Policy.

Organisational structure
The employer tabled the draft macro structure for consultation (attached). The Department will later consult on the functional structure. Members are requested to provide inputs by 28 February 2020 to motjatji.maila@psa.co.za.

Members will be informed of developments.



Millions of rand in alleged “unlawful looting” of the SAPS’s medical scheme Polmed have drawn the ire of scores of police officers, who have slammed the level of coverage received.   Claims are that Polmed, which covers 680000 members and beneficiaries, has “unlawfully” awarded roughly R15.7million to its board of trustees (BOT) over three years in alleged contravention of its own rules.

Allegations are also that former national police commissioner General Riah Phiyega was “illegally” elected on to the BOT in contravention of Rule 18.9.9, which states: “Any person removed from an office of trust on account of misconduct should not serve on it.”

According to rule 18.24, Polmed remuneration should be determined by the scheme’s annual general meeting (AGM) and not by the Council of Medical Schemes (CMS).   By Polmed’s own admission, the scheme hasn’t held an AGM since 2015, with questions being raised as to who approved the BOT payments.

However, internal Polmed documents, which The Star has seen, show that the scheme’s principal officer Neo Khauoe and the BOT’s risk committee were aware that the alleged unlawful payments could drag the medical aid into a legal quagmire.

In minutes from an April 2018 meeting, Polmed hinged its bets on a supposedly vague letter from the CMS, where the scheme realised it could be in trouble with the law.

“Ms (Lydia) Motsepe informed the meeting that the CMS exemption letter was written in very broad terms and that exemptions regarding the increase in remuneration for the BOT were not specified and may cause a future litigation risk.   “The meeting deliberated on the matter and Khauoe mentioned that we may take a risk and assume that CMS provided exemption as was requested,” the minutes read.   The CMS, which promised to answer The Star’s questions sent to it on Thursday, did not answer.

Polmed allegedly made illegal BOT payments of R4.93m in 2016, R5.98m in 2017 and R4.80m in 2018, for a total of R15.71m, while the scheme lost over R140m in 2018 from the previous year because of “the increasing claims ratio” – according to the annual report.

Meanwhile, The Star has been given access to several social media sites where police officers vent about what they believe to be the atrocious coverage received from Polmed.

“I’m having problems with Polmed, which paid only R11000 for my son who was admitted at (an Eastern Cape) hospital (in July), and its total was R42000.   “I’m going to pay an additional R31000,” an emotional father said.   There were hundreds of such messages, with accusations that officers are turned away by many general practitioners.

Phiyega slammed her accusers, saying she had never been found guilty in any court, despite a 2017 report by Judge Neels Claassen that the former commissioner was not fit for office.   Khauoe acknowledged that the scheme has failed to have successful AGMs because of “invalid orchestrated and planned disruptions”.

On the alleged unlawful remuneration, Khauoe said litigation risk was a reality, but that the BOT had to protect member’ interests, not allow a “faction” to rule Polmed “disorderly”, and that BOT fees have not increased since its 2015 AGM.   “A faction who are afraid that their allegations, which you have also mentioned, will be proved otherwise, have always disrupted the meetings, resulting in meetings being stopped without the agenda being fully dealt with,” she said.

“If members believe or have any knowledge or suspicion of any wrongdoing or allegations of looting at Polmed, we encourage them to report such wrongdoing to the police,” Khauoe said.




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