Help at hand as Esidimeni families get their windfalls
Financial experts will give advice to relatives not used to dealing with large amounts of money
Financial councillors have been roped in to assist families of the Life Esidimeni victims, after a compensation payout to mostly destitute families.
The claimants of Life Esidimeni arbitration will by June 16 have received a lump sum of between R1.18-million and R1.2-million.
But experts warned large sums of money can become a source of conflict between families, and also make them the target of those wanting to get their hands on the money.
Family representative Andrew Peterson, on the day of the award, conceded it was possible families could disagree on who the money should be paid over to, or how it should be spent.Debt expert Neil Roets, CEO of Debt Counselling, also warned that when people came into money, they were often targeted by friends and family.
“Money can sometimes cause more problems than it solves. Family and friends will come from all over trying to borrow money. A million rand is not that much. It can be spent in a very short time.”
As an award in the Life Esidimeni arbitration, all 135 claimants were awarded R1-million in constitutional damages and R180,000 for emotional pain and suffering, while the 67 families of patients who died were awarded an additional R20,000 for funeral costs.The award was paid after the state conceded liability for the deaths of 144 mentally ill patients when they were moved from Life Esidimeni homes into ill-equipped NGOs.
“There is a very, very big lack of financial literacy in among many South Africans. Nowhere does anyone get any financial education even [if they complete] school and university,” Roets said.
“It may help people to say to those who want to borrow from them: ‘I don’t control my money. It is being managed by financial advisor’.”
The SA Depression and Anxiety Group's Cassey Chambers, who helped families in the Life Esidimeni arbitration process, earlier said she hoped the families received and made use of financial counselling.Section 27 attorney Sasha Stevenson confirmed that financial counselling had been provided to families.
“Discovery provided a financial wellness workshop and offered free financial advice to our clients.”Asked who in the family would get the money, Peterson, whose uncle survived the move, said: “My own thinking is that payment should go to the most caring and involved family member.”
It is also not clear how the money for survivors will be spent as they are institutionalised.
“The money is supposed to be used for the mental health care patient,” said Nompilo Nkosi, whose brother survived the tragedy.
Legal Aid advocate Lilla Krouse explained that the team had asked for damages for the families and a different amount for the patient, “but the judge made a globular award”.
This means that each family will decide how they will divide the money or whether to put it in trust, she said. “It will be a decision by consensus for each to make.”
Each family will have to reach consensus on who the money will be issued to prior to payment, she said.
Nkosi agreed it was not a simple process.
She said money should be spent to make things better for survivors when they visited their families.
“We want them to be at home with us, but sadly we're not equipped to take care of them ... so it's such things that we as families are looking into.”
While Chambers called for support for families on managing the money, Nkosi also agreed they needed additional help.“We do need support in terms of knowing how to make the space conducive for the patient when they come to visit. For instance, the facility they live in has to be in a certain way. We need that information and more so we can do right by our loved ones.”
Nomvula Nonjabe, another family member, said the large amounts of money paid out could be “tough” to manage. She suggested that it should not be paid out as a lump sum, and that limits are set on the amounts withdrawn.
“It needs to be in held in a trust or with a trust-style of management.”
Many of the participants in the arbitration process are now familiar faces, having been interviewed by the media, and, with the news of their compensation now public knowledge, Roets said they may be approached by salespeople who use “fear” to sell insurance policies or life policies.
Family member representative Christine Nxumalo said only one family member had been approached and asked for bank details but had not passed them on.
Nxumalo said families were supporting each other with advice on how to spend the money.