Business Unity South Africa (BUSA) has lamented inefficiencies and governance failures at the Unemployment Insurance Fund (UIF), which have left it “failing in its primary function\u2014paying unemployment benefits.”<\/p>\n\n\n\n
BUSA said that, consequently, the UIF “must be placed under administration, with immediate effect.”<\/p>\n\n\n\n
The UIF was established to mitigate the effects of unemployment. It raises funds through employer contributions of 2% of the value of each worker’s salary per month.\u00a0<\/p>\n\n\n\n
It offers short-term financial assistance to qualifying workers who are unemployed, sick, on leave (maternity, parental, adoption, or commissioning parental), or dependents of deceased contributors may also be eligible for benefits.<\/p>\n\n\n\n
However, the fund has been plagued with issues.<\/p>\n\n\n\n
In a statement on 6 December 2024, BUSA CEO designate Khulekani Mathe said that “the operational inefficiencies and governance failures of the UIF are letting down hundreds of thousands of workers, many of whom are now facing a festive season without any income.”<\/p>\n\n\n\n
Jonathan Goldberg, the BUSA Labour Market Chamber Convenor at Nedlac, highlighted that it has been almost exactly a year since the initial calls by organised business and labour for the UIF to be placed under administration.<\/p>\n\n\n\n
“Despite promises of a major overhaul by the new Minister of Employment and Labour, Makhosazana Meth, nothing has changed,” said Goldberg.<\/p>\n\n\n\n
The Labour Market Chamber Convenor stated that claimants often wait months or even years for benefit payouts due to inefficiencies at the UIF.<\/p>\n\n\n\n
BUSA bemoaned multi-billion rand labour activation programmes “of dubious origin and impact”, which occur “while the UIF continues to deny benefits to workers who contribute to the fund.”<\/p>\n\n\n\n