Tracing those workers has been particularly problematic, it said last week. The FSB, which oversees more than 5,000 retirement funds, is putting pressure on the trustees of the funds and stepping up joint efforts with the Treasury to find solutions, said the board’s deputy executive officer for retirement funds and friendly societies Rosemary Hunter.
In 2012 there were about 3.3-million unclaimed benefits with an aggregate value of about R15bn in retirement funds.
"We have a huge problem with unclaimed benefits in this country, with pension funds generally. It’s particularly bad in the mining sector," Ms Hunter said.
"As regards putting pressure on the funds, we do get hold of them from time to time and ask them what they’re doing, but we need to work out more intrusive ways of getting involved in that."
The FSB is working on proposals to put to the Treasury and the departments of labour, social development and international relations and co-operation.
"These proposals might include a national database of unclaimed benefits, mechanisms to facilitate the more effective tracing and payment of beneficiaries in SA and other countries," Ms Hunter said.
Personnel firm Teba, which assists mines in recruiting labour and provides services to the sector, puts the size of unclaimed benefits in a number of funds at R5bn. About 200,000 former mine workers or their dependants have to be found to receive these funds, said MD Graham Herbert.
"That number is getting worse. More and more mine workers are owed money. The current system of tracing and paying mine workers is not working," he said.
Trustees from two of the main funds, the Mineworkers Provident Fund, which has 244,704 members according to FSB data, did not respond to requests for comment. The Mines 1970s Unclaimed Benefits Preservation Provident Fund, which has 56,501 members, declined to comment.
Teba, which has a database of 1.3-million mine workers, former workers and their dependants, is anxious to secure a role for itself in tracing and securing payments for the beneficiaries of these funds, Mr Herbert said. Teba, which is more than a century old, used to secure labour from rural SA and neighbouring countries mainly for gold and platinum mines, but there has been a dramatic shift in the labour dynamics on mines.
More than 80% of labour is now drawn from communities around the mines and 20% from distant areas, reducing the need for Teba’s services.
The company is now trying to carve out a new role for itself. In hunting down new revenue sources, Teba is punting itself as the solution to resolving the problems around a large part of the unclaimed pension and provident funds. It has tried to track down some of the beneficiaries as it waits for responses to proposals it has put to trustees of the funds.
"Instead of waiting for the lists, we’ve taken the risk of going onto radio in the first half of the year to ask anyone associated with the mining industry to come to Teba offices or call us if they believe they’re owed money," Mr Herbert said.
It had compiled a list of 120,000 people, and has cross-referenced them with its own database, he said. "Our analysis shows there are 30,000 people who can be instantly found. We know who they are, how much they’re owed by which fund and we can go pay them. We can crack the backlog if we’re given the opportunity and the budget to do it."
The major obstacle appears to be payment. Trustees of the funds are reluctant to pay what’s needed to reimburse the claimants, Mr Herbert says. When Teba traces claimants, it pays the costs of the documentation and verification.
"We don’t find that acceptable. We think the trustees should. They are allowed by law to spend money on tracking and tracing. That’s where this needs to be funded from," he said. "There’s a churlish notion out there that Teba should do this for free. Nobody operates for free."
A senior mining source, who asked not to be named, said one of the mining funds had put out a tender for tracing agents to resolve their backlog and has appointed five companies to do so from early this year. Teba was one of the agencies.
"Teba is not the best tracing agent despite all that data and information they say they have to trace people," said the source. "They have had their costs negotiated down because they were too expensive and not as effective as the others."