South African trade union Solidarity announced that it has started a legal process to stop plans to financing Eskom from the Government Employees Pension Fund (GEPF).

The union says it has written a letter to the GEPF as well as the Public Investment Corporation (PIC), and it is demanding that the Trustees and the Board of these institutions should not accept the controversial plan to finance Eskom from the Fund. In the letter, Solidarity called the Trustees’ attention to their fiduciary duties.

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The union also pointed out that individual trustees and board members will also be held personally liable for damages if they do not fulfil their fiduciary duty. “The mandate of the GEPF and the PIC is to act in the best interest of the client.

The board members and the trustees may not be influenced by the political agreements of other mandate givers. If goals other than the best investment return for the pension fund member are pursued, they would be unlawful,” says the union.

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According to Solidarity, if President Cyril Ramaphosa makes such an announcement in his State of the Nation address, it will have an undue influence on the mandate of the GEPF and the PIC. A political gun against the heads of the GEPF and the PIC will mean the decision will not be voluntary; it will be enforced.

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