I can't unilaterally extend UIF Covid-19 scheme, labour minister tells Parly

Minister of Employment and Labour Thulas Nxesi during a media briefing.
Minister of Employment and Labour Thulas Nxesi during a media briefing.
GCIS
  • Minister Thulas Nxesi said despite logistical challenges and reported fraud, the rollout of payments was largely successful.
  • Nxesi said the Special Investigative Unit was investigating to charge individuals who benefited from illegal payments and recover the money.
  • He said 157 cases were being investigated, including 38 of employers withholding or underpaying employees’ benefits and 90 suspected fraudulent claims.

Employment and Labour Minister Thulas Nxesi told the National Assembly on Tuesday afternoon that he could not "unilaterally" announce another extension of the Unemployment Insurance Fund's Temporary Employer-Employee Relief Scheme.

Refusing to be drawn, Nxesi said: "I cannot announce that we will be extending. That would be unilateral."

The decision had not yet been taken yet, he added.

"It must be a product of discussion of the social partners. But we must look at the liquidity of the fund and the scheme with economists. But I cannot, in my own accord, just announce that."

The minister's remarks come a week ahead of Finance Minister Tito Mboweni's medium-term budget policy statement, and on the back of last week's speculation that the payments might continue into the month of November.

Millions of South Africans have lost their jobs during the pandemic, with the TERS scheme developed in response to provide a measure of financial relief.

However, an audit of the scheme found alarming gaps including overpayments, underpayments, inflated payments and payments to claimants who did not qualify – including some R800 000 to people who were dead, underaged or in prison.

Nxesi said on Tuesday that despite these challenges the rollout of payments thus far had largely been successful.

"As of 19 October, since the beginning of the lockdown, R49.5 billion had been disbursed in benefits in the form of over 11 million payments, reaching some 5 million laid-off workers," said Nxesi.

Regarding the Auditor General's report and the precautionary suspension of UIF management, Nxesi said the Special Investigative Unit was investigating to charge individuals who benefited from illegal payments and recover the money.

"In some cases, bank accounts have been frozen and assets have been seized. People have been charged and arrested. An among of R3.5 billion of wrongful payments have already been recouped.

"My thanks to the many honest, responsible employers who returned over-payments after realising a mistake had been made – often benefits were calculated on the basis of incorrect information," Nxesi said.

He said 157 cases had been allocated for investigation, including 38 of employers withholding or underpaying employees' benefits, four cases of employer using incorrect UIF reference number, one case of overpayment of UIF benefits to employers and 90 suspected fraudulent claims.

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