THE UIF MUST DO ITS JOB: PAY UNEMPLOYMENT BENEFITS.

Johannesburg, Friday 06 December 2024 ― The operational inefficiencies and governance failures of the Unemployment Insurance Fund (UIF) are letting down hundreds of thousands of workers, many of whom are now facing a festive season without any income. The UIF is failing in its primary function – paying unemployment benefits - and must be placed under administration, with immediate effect.

Jonathan Goldberg, the BUSA Labour Market Chamber Convenor at the National Economic Development and Labour Council (Nedlac) says: “It is now almost exactly a year since the initial calls by organised business and labour for the UIF to be placed under administration. Despite promises of a major overhaul, by the new Minister of Employment and Labour, Makhosazana Meth, nothing has changed. Workers and their employers remain frustrated by the inefficiencies and lack of support during times of need.” It is well documented that claimants are often shuffled from pillar to post, waiting months and sometimes even years to receive their benefit payouts. This year, the inefficiencies at the UIF were compounded by a legal wrangle that left the uFiling and the UIF App offline for several weeks. The recent addition of new types of leave for employees, to be paid by the UIF, further burdens a system that is already operationally weak.

There are also reports that R26 billion has been allocated to labour activation programmes of dubious origin and impact - while the UIF continues to deny benefits to workers who contribute to the fund. The weak operations and lack of governance, accountability and transparency underlines the necessity for active oversight of the UIF, from organised business and labour, who represent the funders and beneficiaries of the fund. Advisory boards at the UIF do not work, as the risks they highlight and their recommendations, are simply ignored.
Sanelisiwe Jantjies, BUSA’s acting director for social policy, points out that:

• According to Statistics South Africa, half a million more people joined the ranks of the unemployed in the first six months of 2024.
• Tens of thousands who, while still employed, have suffered significantly reduced work hours due to supply chain challenges and weakened economic conditions. Workers can lose up to two-thirds of their usual earnings and still not receive any assistance, from the UIF.
• The Commission for Conciliation, Mediation and Arbitration (CCMA) Temporary Employer / Employee Relief Scheme (TERS) programme was established to allow companies to access funds from the UIF and Sector Training Authorities (SETAs) to support their workers while their businesses were turned
  -around. This programme had the potential to avert job losses, yet the slow pace of processing means that most applicants are already retrenched, and businesses closed before receiving any assistance. Given this reality, it is difficult to celebrate the recent announcement of an increase in the CCMA TERS budget to R400 million, when it cannot be accessed due to the administrative issues within the UIF.

“Strained economic conditions and the resulting reduced work time and job losses demand a well-functioning, easily accessible insurance scheme for impacted workers. The UIF, in its current and proposed forms, is not that,” says Jantjies. It is time for the UIF to finally be put under administration – to rescue workers and companies from its weak governance and maladministration.

ENDS

Khulekani Mathe
CEO Designate

For more information, please contact:
Sizwe Maswanganye
Tel: 011 784 8000/0766516444
Email: sizwe.maswanganye@busa.org.za