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More questions than answers over Steinhoff crisis leaves MPs frustrated

Steinhoff executives have been appearing before three committees at Parliament in a one-day meeting aimed at uncovering the origins of the crisis

Picture: Steinhoff official Facebook page.

CAPE TOWN - Frustrated Members of Parliament (MPs) have been trying to get answers about what went wrong at Steinhoff, but members of the global retailer’s board and top management have been unable to answer most of their questions.

They’ve been appearing before three committees at Parliament in a one-day meeting aimed at uncovering the origins of the crisis and finding out what steps are being taken to address it.

The Public Investment Corporation (PIC) and the Government Employees’ Pension Fund were among those with funds invested when CEO Markus Jooste resigned in December 2017 and Steinhoff’s share price plummeted.

MPs were not happy with former Steinhoff chairperson Christo Wiese’s claim that the crisis hit like a bolt from the blue and also felt strongly that South African regulators should have acted sooner and more decisively.

Steinhoff’s acting board chairperson Heather Sonn says no one will be spared in the forensic investigation PriceWaterhouseCoopers is now engaged with, but the company can’t say how long this will take.

“We are not here to evade anything… we’ve stepped into a situation which required stability in the immediate term. We are open and have opened ourselves up to the full scope of the PWC forensic investigation, no one is spared there.”

Wiese’s told MPs the criminal complaint laid with the Hawks against Jooste concerns matters other than the so-called accounting irregularities flagged by Steinhoff’s long-serving auditors, Deloitte.

'PENSIONS ARE SAFE'

The Government Employees Pension Fund (GEPF) says public servants should not worry about their pensions because of the Steinhoff debacle.

The GEPF is a defined benefit pension fund, which means its members’ pensions are guaranteed.

The value of the fund’s Steinhoff shares depreciated from just over R24 billion at the end of November last year to R1,8 billion at the end of December, after the collapse of the company’s share price.

The GEPF and the Public Investment Corporation, which invests on its behalf, have been briefing three committees at Parliament.

The GEPF’s principal executive officer Abel Sithole says the latest actuarial valuation GEPF’s funding levels put them at 115%, meaning it can meet its commitments.

“Public servants are not affected directly by what has happened in terms of (the) depreciation (in Steinhoff’s share value), simply because the fund pays benefits in terms of rules and pensioners will be paid regardless.”

But Sithole says it is also important that the fund does not make losses.

“Because ultimately we would have to go back to government - and then to taxpayers – to ask for additional money. And so far, there is no need for that to happen because the fund is very well funded, over 115% at the last valuation.”

The GEPF says pension increases due in April will be paid.

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