Government considers new Covid-19 relief provisions for employees and employers alike.
The government and its social partners are exploring various alternatives to providing relief to workers affected by Covid-19, as well as the long-term sustainability of the Unemployment Insurance Fund (UIF).
The Temporary Employer/Employee Relief Scheme (TERS) benefit was introduced in March to help employers disburse wage benefits to employees via the UIF. The scheme was one of the main pillars of government’s R500 billion Covid-19 relief package and was to run for three months, from April to June. It was then extended from August 16 to mid-September. President Cyril Ramaphosa committed to availing the aid until the end of the state of disaster, which has been extended to November 15.
Business and labour sectors are facing uncertainty pending the government’s decision on TERS’s future. Employment and labour minister Thulas Nxesi said he had taken extraordinary steps to try to break the impasse. Nxesi said he had a duty to ensure the UIF was not so depleted that it could not meet its future obligations.
“At the same time, we are conscious of the fact that the lockdown, albeit at a less strict level, is still in force and therefore there are industries that require support. That is why we have been engaging with partners to find the best way forward.”
The minister said the talks needed to consider that the UIF had delivered on its initial commitment of R40 billion over three months and paid out more than R51 billion.
Partners at the National Economic Development and Labour Council (Nedlac) have voiced their concern at the possible termination of the scheme. The DA said it was clear from several written parliamentary replies to questions posed to Nxesi that the UIF was in a seemingly precarious state.
“It is not clear whether the UIF will be financially sustainable in the long term, given the expected increase in unemployed South Africans applying for ordinary UIF benefits,” MP Michael Cardo said.