Compensation Fund must account to Parliament on new regulations

21 October 2021

Note to Editors: Please find an attached soundbite by Dr Michael Cardo MP

The DA has written to the chair of the Portfolio Committee on Employment and Labour, Ms Mary-Ann Lindelwa Dunjwa, requesting that the Compensation Fund account to the committee as soon as Parliament reconvenes.

This follows the publication in the Government Gazette on 19 October of a notice enforcing new banking information requirements for compensation of occupational injuries and disease (COID) related claims.

The bottom line is that the Compensation Fund is trying to put third party pre-funding administrators out of business. These administrators perform an essential function in transacting with the Compensation Fund on behalf of medical service providers.

Historically, medical service providers have ceded their claims to third-party administrators for payment by the Fund. The Compensation Fund has been dysfunctional for over two decades; its new ‘CompEasy’ claims system is almost impossible to navigate; and medical service providers often have to wait up to two years – or longer – for payment. Third party pre-funding administrators ease the burden on medical service providers by dealing directly with the Compensation Fund. But the Fund wants to get rid of them because of a series of legal challenges brought by the administrators against the Compensation Fund, of which – embarrassingly – the Fund has repeatedly been on the losing side.

Recently the Compensation Fund tried to legislate the problem away with proposed amendments to the COID Act. When that failed, the Minister of Employment and Labour, Thulas Nxesi, cynically gazetted a series of irrational and draconian regulations the day after Parliament rose for the local government election campaign. The regulations removed the right of medical service providers to use the services of third-party pre-funding administrators to ensure they are paid for treating injured workers. A humiliating climb-down ensued and the regulations had to be withdrawn.

Now the Compensation Fund is trying another tack. The latest regulations state that the Compensation Fund will no longer accept banking details and nominated bank accounts of agents and other representatives other than that of the medical service provider or the healthcare organisation which provided the service to the injured or deceased beneficiary. The Fund will only accept banking details belonging to the medical service provider or relevant healthcare organisation.

This is yet another ploy by the Compensation Fund to disembarrass itself of third-party administrators.

The DA calls for the Compensation Fund to explain to the Portfolio Committee exactly what the purpose and rationale of these regulations are in the interests of clarity and accountability.

Issued by Michael Cardo, DA Shadow Minister for Employment and Labour, 21 October 2021