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UIF says sluggish economy, pandemic payouts are depleting fund's coffers

People queue for Covid-19 Ters benefits at the Unemployment Insurance Fund offices in Johannesburg. File photo.
People queue for Covid-19 Ters benefits at the Unemployment Insurance Fund offices in Johannesburg. File photo.
Image: Fani Mahuntsi/Gallo Images

If SA's economy continues to suffer, workers who lose their jobs could in future have less to fall back on as the Unemployment Insurance Fund's (UIF) kitty gets depleted.

UIF commissioner Teboho Maruping said this on Wednesday, adding that Covid-19 Ters payouts had undoubtedly dented the fund's coffers in the past two years.

Since early 2020 the relief scheme, intended to replenish the incomes of employees who lost their jobs due to the pandemic, has paid out about R61bn.

At a media briefing on Wednesday to unpack the priorities of the fund during the 2021/2022 financial year, Maruping said the UIF had recovered millions fraudulently or mistakenly paid to recipients.

Maruping said the UIF coffers had dipped from R160bn before Covid-19 to about R120bn now. Asked if he was not concerned about the effect of the sluggish economy on the fund, he said: “I’m concerned. If the economy continues not to pick up in terms of creating jobs, creating entrepreneurs and companies surviving, it is going to affect the UIF kitty.

“Sooner or later the UIF will run out of funds. It is a concern on which we and the executives engage.”

But on a positive note, Maruping said UIF contributions were picking up again after a dip during the pandemic. The increase was observed over the past six months.

“Somewhere our contributions are picking up slowly, but there is a loss of jobs [too]. There are certain markets that are creating jobs and others are losing jobs. So there is a balancing factor that we have not really analysed.”

Labour department auditor Smiso Nkosi, who heads the “follow the money” project — established in 2020 to track fraudulent claims — said R14bn of payments had been traced and 91% of them were found to have been correct.

He said phase 2 of the project would prioritise cases where there had been complaints, including those related to businesses which had opened during the pandemic.

TimesLIVE


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