"UIF is not Some Money Tree" Minister Says as Cosatu Pushes for Extension of the 3 Months of TERS
View pictures in App save up to 80% data.
Deputy Minister of Labour and Employment Boitumelo Moloi told parliament on Friday afternoon that the Unemployment Insurance Fund (UIF)'s financial stability is in jeopardy and needs to be addressed.
"The UIF is not some money tree with unlimited resources. As we work on the fund and gear it to assist more workers, we have to consider its financial stability for the future," she said. View pictures in App save up to 80% data.
The Deputy Minister was echoing Minister Thulas Nxesi's sentiment in May when he told the same parliamentary committee that the UIF is under serious strain as the Covid19 pandemic and the national lockdown restrictions continued in South Africa.
With the unemployment rate above 30% and expected to increase as the economy struggles with most companies on the brink of closure, the strain on the fund is set to increase. View pictures in App save up to 80% data.
Employees that have been retrenched are not the only people that the UIF must take care of during this pandemic. There are those workers that could not work during much of the lockdown phase of the economy who are also being paid the UIF. View pictures in App save up to 80% data.
Therefore, the queue of workers seeking assistance from the UIF keeps on getting longer.
Nxesi had warned that these benefits were limited, and a long-term solution to deal with employment insecurity should be implemented by the state
The UIF, under normal circumstances pays out sums of money to employees who contribute to the fund once they lose their jobs.
Due to the Covid19 national lockdown the fund had to implement funding to protect businesses affected by the lockdown so that they can continue paying salaries while closed.
The UIF went from disbursing R17million a day on average before Covid19 to R700million a day on average during the pandemic. View pictures in App save up to 80% data.
Congress of South African Trade Unions (Cosatu) parliamentary liaison officer Matthew Parks pointed out that the UIF shouldered a huge load of providing funds to millions of workers while banks and insurance companies were just folding their hands.
"We are engaging with the UIF to provide further coverage for those who can't go back to work, including those in their sixties," he said. View pictures in App save up to 80% data.
Parks further revealed that Cosatu is trying to push for an extension of the 3months of Temporary Employer/Employee Relief Scheme(TERS) cover until the restricted employees all go back to work.
The TERS, according to Minister Nxesi will end in June as the 3months would have lapsed. This will be a major blow to employees who are still affected by the lockdown since companies they work for, remain closed.