- The Pension Funds Adjudicator has set aside the Old Mutual SuperFund Provident Fund’s allocation of a R417,096.39 death benefit.
- The fund must reconsider the financial needs of the deceased’s spouse and minor daughter before making a new allocation.
- The adjudicator found that trustees cannot rely only on actuarial models without properly investigating and explaining their decisions.
A dispute over the distribution of a deceased father’s pension death benefit has been sent back to the Old Mutual SuperFund Provident Fund after the Pension Funds Adjudicator found the fund failed to properly justify its allocation to his minor daughter.
Pension Funds Adjudicator Lebogang Mogashoa set aside the fund’s decision to distribute a R417,096.39 death benefit and ordered trustees to reconsider the financial needs of the deceased’s spouse and minor child before making a new decision under section 37C of the Pension Funds Act.
The deceased, who was a member of the Old Mutual SuperFund Provident Fund, died on 23 May 2025, leaving behind his spouse, minor daughter, and other family members identified during the fund’s investigation.
Mother challenged the allocation
The complaint was brought by the deceased’s mother, who argued that the fund had unfairly disadvantaged the minor child by giving the largest share of the benefit to the deceased’s spouse.
The Old Mutual SuperFund Provident Fund gave 70% of the death benefit to the deceased’s spouse as a legal and factual dependant. Another 25% went to the deceased’s minor daughter, 5% to the deceased’s mother, and nothing to a stepchild, nephew, or former partner after finding they were not dependants or not entitled to a share.
The complainant, the deceased’s mother, said the deceased’s spouse should not have been treated as a spouse because lobola negotiations had not been completed. She also said the daughter was his only biological child, sole heir, and the person most financially dependent on him.
Guardian raised changed circumstances
The child’s mother and legal guardian told the adjudicator that her financial situation had changed significantly since the allocation was made. She explained that she had been unemployed since 29 January 2026, leaving her without a steady income to support her daughter, who is in Grade 11.
She argued that the fund did not consider the child’s educational needs, daily expenses, and the likelihood she would remain financially dependent for another 7 to 8 years while finishing tertiary studies. Ms R also submitted the child’s school account, which showed outstanding fees of R3,899.90, as proof of her immediate financial needs.
Spouse defended her dependency
The deceased’s spouse disputed the complaint, saying she had been in a customary marriage with the deceased since 16 June 2018 and was still his spouse at the time of his death.
She told the adjudicator that although she worked as a technical support agent, the deceased regularly supported her household by buying groceries and paying school fees for her biological son from a previous relationship. In addition, she received a monthly social grant of R2,200 and had received a R60,000 funeral payout after the deceased’s death.
The spouse said that an application to confirm and register the customary marriage was still pending before the High Court.
Trustees relied on an actuarial model
The Old Mutual SuperFund Provident Fund defended its decision by explaining that trustees had used an actuarial model to calculate how much support each dependant would need.
According to the fund, the model considered how financially dependent each beneficiary was and worked out how much would be needed to replace the deceased’s support. Since the available benefit was not enough to meet everyone’s needs, the fund said it divided the money based on the model’s outcome.
The fund also argued that the child’s mother’s unemployment happened after the allocation was made, so it could not be used as a reason to change the distribution.
Adjudicator found the reasoning inadequate
Lebogang Mogashoa, the Pension Funds Adjudicator, said trustees have a duty to investigate the circumstances of every dependant individually and give proper reasons for the allocation they make.
He found that the fund had not adequately explained why an employed spouse who receives a salary, a social grant and a funeral benefit was given 70% of the death benefit, while the deceased’s minor daughter got 25% even though she is likely to be financially dependent for many years.
“The fund cannot base its decision solely on its actuarial method in allocating a death benefit without overlaying its results with good common sense and proper reasoning for the allocation of the benefit,” Mogashoa said.
He added that simply citing an actuarial model does not properly justify the board’s decisions and falls short of the fair distribution required by section 37C.
Fresh allocation ordered
The adjudicator set aside the board’s allocation relating to the deceased’s spouse and minor daughter and told the Old Mutual SuperFund Provident Fund to reconsider their financial needs before making a new decision.
The determination means the death benefit will remain undistributed between the two main beneficiaries until the fund completes a new assessment and properly makes its decision.
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