Trade union Solidarity maintains the liquidity crisis at Denel – of which the latest indicator is non-payment of pension fund contributions – is pushing the State-owned company “further into the abyss every day”.
A Denel letter to employees states June pension fund contributions were deducted from salaries but not paid to the pension fund which raises the question of “what exactly has been paid and what not” according to Helgard Cronje, Solidarity defence and aerospace sector co-ordinator.
“Feedback we received indicated medical aid contributions were paid, but not PAYE tax, UIF contributions or June pension fund contributions.”
He had harsh words for government saying: “The historic financial mismanagement and consequential liquidity challenges is pushing the arms manufacturer further into the abyss every day. This again confirms government is unnecessarily dragging its heels because it does not realise the gravity of the crisis”.
From its side the trade union last year compiled and presented the Denel Dossier to management of the SOC. It contains information on “numerous counts of mismanagement and even corruption by members of Denel’s previous management”. This, Cronje said, led to Denel’s current financial woes.
“A forensic investigation was also undertaken. Earlier this year Denel confirmed it intended to take action against those involved. Solidarity has to date not received confirmation of any steps and those who should be called to account have still not been brought to book.
“Solidarity is most upset by Denel’s inability to communicate proactively with its workforce when it comes to challenges of this nature,” Cronje said adding the trade union was considering legal action. This would see Denel handed over to the relevant financial authorities for defaulting.
Another trade union – UASA – this week said the non-payment of pension fund and medical aid contributions was fraud. Amounts were deducted from salaries for this purpose “but did not get to where they were supposed to.”