Unions in dark after Gems suspends head Stan Moloabi

The board of the Government Employees Medical Scheme (Gems) has placed its principal officer, Stan Moloabi, on precautionary suspension, pending “the completion of an internal administrative process”, it said on Tuesday.

The scheme provided no details of what the process entails, and Moloabi confirmed his suspension but declined to elaborate, saying he was prohibited from commenting further.

Gems COO Vuyo Gqola has been appointed acting principal officer and the scheme continues to operate normally, the board said.

Gems is the largest medical scheme available to public servants and their dependents. It provides cover to more than 2.4-million beneficiaries.

The board said in a statement that Moloabi’s suspension was not related to the scheme’s financial position, reserves or solvency, nor was it related to any stakeholder or union demands. “Our priority remains the continued stability of the scheme, the protection of our members’ interests and adherence to the highest standards of corporate governance,” said board chairperson Nomzamo Tutu.

Gems has faced sustained pressure from unions in the past year over the scale of its contribution increase for 2026, which it initially pegged at a weighted average of 9.8% but lowered to 9.5%, effective April 1.

It announced on May 7 it would further cut the contribution increase to 7.5% from July 1. The plan was subsequently vetoed by the Council for Medical Schemes (CMS) on the grounds it threatened Gems’ financial stability.

The board said it had a fiduciary responsibility to ensure the scheme’s governance processes were applied consistently, fairly and without prejudice. “The decision to place the principal officer on precautionary suspension is an interim measure that enables the appropriate internal processes to unfold with integrity and independence. It should not be construed as a finding of misconduct or wrongdoing,” it said.

Organised labour appeared to be in the dark, with neither Cosatu, SA’s biggest trade union federation, nor the Public Servants Association privy to the reasons behind the board’s decision.

Cosatu’s chief negotiator for the public sector bargaining council Itumeleng Molatlhegi said the federation would table a question about Moloabi’s suspension in the council.

Unions have previously raised concerns about the remuneration of both the executive and board members at Gems. Earlier this year they called for the removal of the principal officer and scheme executives, and criticised the frequency with which the board of trustees meets.

There were 53 board meetings last year, generating more than R1.4-million in fees for each trustee, according to Molatlhegi.