South Africa’s organised labour federations – COSATU, FEDUSA, SAFTU and NACTU – have called for the country’s two social security funds, the Unemployment Insurance Fund (UIF) and the Compensation Fund (CF), to be overhauled. They are demanding that competent management and modern systems be put in place to ensure effective and efficient administration.
The call comes after the federations raised serious concerns over what they described as a “worsening crisis” at the funds, which are entrusted with providing support to workers in times of need.
NACTU Acting President Medupi Maile told YOU FM Newshour that both funds had failed spectacularly to fulfil their mandate.
“These funds have failed workers and employers who contribute to them, and they are not functioning as efficiently, transparently or honestly as expected.
“This is why we, as federations, are frustrated. We represent the interests of our affiliates and their members, who look to us to intervene when things are not done properly.
“You will recall that this is not the first time we have highlighted these challenges as a federation. Over the years, we have repeatedly spoken out against some of these issues, but little to no change has been realised. Hence, we have adopted this stance,” said Maile.
Maile added that the federations were also concerned about the alleged widespread corruption at the UIF, recently uncovered through investigations by the Special Investigating Unit (SIU).
“Recent revelations by the SIU regarding fraudulent claims from the UIF Temporary Employer/Employee Relief Scheme (TERS), amounting to R27 million during the COVID-19 pandemic, demonstrate the depth of the crisis at the fund.
“The companies involved allegedly used ghost employees to support their claims and received millions of rand, while legitimate claimants and employers acting on behalf of workers remain unpaid for claims submitted during the lockdown and the July 2021 unrest,” Maile explained.
In addition, organised labour welcomed and agreed with the Supreme Court’s ruling that the dire state of the funds warrants an urgent and independent investigation.
The federations have called on the President and the Department of Employment and Labour to place the funds under administration or appoint new management under strict conditions. They have also urged the deployment of both the Hawks and the SIU to investigate allegations of systemic and serious corruption at the UIF and CF.
“The lack of consequence management is alarming, given the repeated failure to address audit findings and governance shortcomings.
“Compensation Fund reports have revealed widespread fraudulent activities, with many allegations pointing to the involvement of officials in wrongdoing.
“Disturbingly, it appears that no attempt has been made to hold those responsible accountable,” said Maile.
