The Department of Military Veterans (DMV) has approved pensions for 1,889 military veterans but cannot pay them because it has no money.
The department’s chief financial officer, Sibongiseni Ndlovu told Parliament’s Portfolio Committee on Defence and Military Veterans on Wednesday, 11 November.
According to Ndlovu the unpaid pensions add up to about R271 million.
“In addition to the current recipients, Chair and members, there are 1,889 approved military veterans for pension. However, we are unable to pay them because the funds are not there. This equates to about R271 million,” he said.
The CFO said that another 7,624 applications are still being assessed, and that approving them would create new debts the department cannot fund.
“Once we issue an approval letter, it means that the liability commences and accrues, and then the liability needs to be paid,” he said.
The department is also short of money for veterans who are already being paid.
It budgeted R172 million this year, but it needs R264 million to pay the 4,175 veterans currently receiving pensions.
To cover the R92 million gap, it moved money from other benefits, including education support and skills, cut its travel budget, and used money meant for vacant posts.
Ndlovu also admitted that the department overspent by more than the allowed 8% last year, in breach of section 43 of the Public Finance Management Act, to keep paying pensions in February and March.
He said veterans’ pensions need more than R600 million a year, while the whole department’s budget is about R912 million.
“The military veterans’ pension requirement is above what the DMV can afford,” he said.
The department has asked National Treasury for a one-off R271 million to clear the backlog. It has also asked for pensions to become a direct charge on the National Revenue Fund.
The CFO said both requests are still waiting for a decision.
DA MP Chris Hattingh said the money owed to veterans could not be ignored.
“This is an unfunded liability, but it cannot just be swept aside and let ageing veterans wait for somebody, at some stage, to pay it, while politicians go ahead and make promises that all pensions will be paid,” he said.