Huge admin costs threaten fund for sick miners

There are mounting concerns that the Tshiamiso Trust fund, set up to compensate miners following a 2018 landmark silicosis class action settlement, may shut down years before its mandate ends in 2031. Photo: Dan Brown via Flickr (CC BY 2.0)

• The multi-billion-rand Tshiamiso Trust was set up in 2019, by large mining companies, to compensate miners with silicosis and TB. This trust was the result of a 2018 court settlement.
• The Trust is supposed to continue its work until 2031.
• The fund has R5-billion of which a massive R845-million is for operations. Yet over 80% of the R845-million will be spent by the end of 2026, putting the viability of the fund at risk.
• Staff salaries have exceeded R30-million per year. Trustee fees are also extremely high.
• Fewer than 25,000 sick miners — or their families, in cases where the miners have died — have so far been compensated. But hundreds of thousands of miners have applied for compensation, meaning the Trust is nowhere close to finishing its mandate and it will likely need much more than R5-billion to settle all legitimate claims.
• Over R2-billion has been paid out in compensation. The R5-billion fund is not capped, so it can be increased as more miners are compensated, but the R845-million operational budget amount is capped — it cannot be increased.
• Critics accuse the mining companies of using an unnecessary procedure that is delaying the assessment of claims. But the mining companies claim it is reasonable.

The Tshiamiso Trust is a multi-billion-rand fund set up to compensate miners with TB or silicosis, or their families. It was a result of the historic 2018 landmark silicosis settlement. Six years after its creation, there are mounting concerns that the hundreds of millions of rand allocated for its operations could soon be depleted, threatening to shut down the Trust long before its mandate ends.

Justice for Miners (JFM), a lobby group for ex-miners with TB and silicosis, has warned that if the R845-million for operational costs runs out before the end of the Trust’s lifespan in 2031, unclaimed money from the R5-billion rand settlement (which includes the operational costs) could be returned to mining companies, leaving thousands of miners without compensation.

“This would be a travesty of justice for thousands of unpaid miners and their families, and this would make a mockery of the class action,” said Catherine Meyburgh, JFM’s advocacy head in the South African Development Community.

“If the trust runs out of the admin budget, countless ex-miners, especially those in rural areas who remain untraced, could lose out,” she said.

The admin fund covers the day-to-day running of the Trust, including salaries, medical assessments, and tracing of claimants.

The fund is a result of a settlement between the lawyers of mine workers and the six mining companies that are party to the agreement: African Rainbow Minerals, Anglo American, AngloGold Ashanti, Gold Fields, Harmony and Sibanye-Stillwater.

The agreement allows compensation for miners who worked at qualifying mines between March 1965 and December 2019.

Meyburgh is concerned that by the end of 2026, over 80% of the admin fund, capped at R845-million, is expected to have been used. This suggests that before the trust reaches its 12-year life span in 2031, it would have exhausted its operational budget and possibly cease to exist.

GroundUp has seen a memo, shared by the Trust’s CEO Munyadziwa Kwinda to the Trust’s advisory committee in June this year, which states that about R152-million of the admin budget will be left by the end of 2026.

The memo notes that a large portion of funds was spent upfront on setup costs like call centres, staffing, IT systems, and medical expenses. By February, about R560-million had been used to process R2-billion in claim payouts.

Meyburgh said the mining companies were using hurdles and interpreting the trust deed differently to limit payouts and to avoid having to top up the R5-billion fund.

“The aim of mining houses is to stretch the process and pay as little as possible so the R5-billion fund lasts without requiring a top-up. If the trust exhausts its admin budget, it’s a financial win for the mining companies,” she said.

George Kahn, a human rights lawyer from Richard Spoor Attorneys, who was part of the legal team that represented miners during the class action lawsuit, said he learnt of the potential shortages of the operations budget through a concerned member of the Tshiamiso Trust Advisory Committee.

“If it’s true, it means that the Trust settlement is not going to be fully implemented, and the money will have to go back to the mining companies. This would be a devastating result. It means the process that was presented to the high court in approving this is going to turn out to be false,” he said.

“Scrutinising operational efficiency”

When GroundUp contacted the Trust about the budget shortfall, spokesperson Lusanda Jiya wouldn’t confirm or deny it, but hinted that the Trust was exploring cost-cutting measures.

“In addition to scrutinising our operational efficiency more closely and exploring avenues for cost reduction, strategies are underway to secure sufficient budget to fulfil our mandate,” she said.

Redundant medical examinations?

JFM says the Trust could have saved millions if it had not yielded to mining company pressure to re-examine ex-miners who already have MBOD (Medical Bureau for Occupational Diseases) certificates. These certificates would indicate if a miner has TB or silicosis. Despite the Trust Deed allowing the use of these certificates to file a claim, mining agents reportedly rejected the findings and demanded original diagnostic documents.

“In layman’s language, what they are asking is equivalent to traffic police rejecting your driver’s licence and demanding to see your eye test and learner’s licence as well,” said Meyburgh.

She said if ex-miners were allowed to use their MBOD certificates, chances are the Trust would use up the R5-billion fund earlier.

(GroundUp understands that the Trust deed requires that an MBOD certificate must be accepted if (1) it the certificate approved in terms of the Occupational Diseases in Mines and Works Act, and (2) it shows the miner had silicosis or TB of the lungs.)

Kahn also expressed reservations. “As lawyers, we told the judges the process would bypass medical tests to save money and speed up payouts, and the judges looked at the process and approved it. If the trust is now running short of funds and claimants can’t use these certificates, the question is, has the process we all agreed on been followed?”

Meyburgh also noted that many ex-miners are classified in the lowest tier — class 1 silicosis — and are eligible only for a R70,000 payout. “This appears to be aimed at limiting mining companies’ payouts,” she said.

Mining companies reject allegation

The mining industry denied interfering with the trust or blocking payments and expressed willingness to discuss the budget shortfall to ensure all eligible claimants were compensated.

James Wellsted, executive vice president of investor relations and corporate affairs at Sibanye Stillwater, said that asking claimants to undergo medical tests to confirm TB and silicosis was “entirely reasonable” as it ensured that money was paid to legitimate claimants.

“If after undergoing further medical tests, (claimants) were found to be ineligible, that would support the rationale for not just accepting any medical certificate. If the medical certificates were all valid, why were they not corroborated by the medical tests?”

Mining companies’ representative Paul Pretorius said discussions about the government-issued certificates were ongoing, and the differences among parties within the trust should be expected given the complexity of the 2018 agreement, as long as these were constructive and ensured eligible claimants received their benefits.

“We reject the allegation that the mining companies or their agent are seeking to frustrate the work of the trust or to limit compensation.”

Pretorius attributed the slow pace of paying claimants to challenges in tracing claimants and processing claims across South African borders.

Only a fraction of claimants compensated

To date, the Trust has paid more than R2.1-billion to just over 23,000 claimants. This week, its dashboard showed that over 385,000 people have indicated they intend to claim by registering through the Trust’s call centre. So far, nearly 148,000 people have lodged their claims and submitted their documents.

Massive operational costs

The 2024 annual report showed that, in addition to salaries that cost over R31.4-million in the financial year, the biggest expenditures were on medical costs and medical certification costs, which exceeded R21.4-million combined. IT expenses came to about R13.6-million and lodgement fees were just more than R10.1-million.

In 2023, staff salaries exceeded R33.7-million, medical costs and medical certification costs came to about R32-million, IT fees were about R22.6-million, and lodgement fees R13.4-million.

Jiya wouldn’t say how much the executive management of the trust is paid, saying it would be premature to reveal salaries at this stage. She said such details would be discussed at the trust’s AGM in August, which would deliberate on the latest financials for the 2024/25.

In 2024 about R1.48-million was paid to three trustees, including chairperson Prof May Hermanus who was paid R812,245. Occupational medicine specialist Dr Sophia Kisting-Cairncross, who represents the claimants, received R403,600, along with Janet Love who was paid R266,667.

Given the long-term nature of TB and silicosis and the need for specialised medical expertise, Jiya said the bulk of the trust’s budget was allocated for medical exams, certification, and claims management software.

Of the approximately 23,500 claimants paid by 31 July, about 15,000 were classified as silicosis class 1, which paid up to R70.000. About 3,000 claimants were classified as silicosis class 2 and qualified for up to R150,000, while 2,200 were classified as silicosis class 3 and qualified for up to R250,000. There were about 2,000 dependent TB claimants.

In 2024 and 2023, the trust also spent R2.2-million and about R3-million on local travel, while it paid R1.5-million and just over R2.2-million on lease and rental during the same period.

Kahn said the risk of the premature closure of the trust due to financial pressures should worry the mining industry and encourage it to find ways of topping-up the fund.

“The mining companies can take responsibility for what they’ve done and allow the process to carry out the way it was agreed and intended. It is in their best interest, and the society’s best interest, to protect their reputation and make right what they were partly responsible for under apartheid,” said Kahn.

Mining companies told GroundUp they were willing to have more discussions about the budget shortfall. Wellsted said, “The companies are committed to the process, and should further funding be required, discussion between relevant representatives will no doubt take place.”

Pretorius said while the R845-million was considered fair and reasonable during the settlement, the mining industry agents were willing to have constructive discussions with all concerned to ensure that the settlement was fully implemented before 2031.

More about Silicosis case

• Huge delays in payouts to miners with silicosis and TB 25 July 2025
• Silicosis class action bolstered by Appeal Court ruling 07 February 2023
• Two years after landmark silicosis settlement, no one has been paid 20 July 2020

Support independent journalism
Donate using Payfast