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Nedlac to review UIF’s capacity to pay COVID-19 relief funds

A meeting will be held between the Department of Employment and Labour, along with Nedlac constituencies including labour, business, and government.

Labour Minister Thulas Nxesi during a walkabout at the extended UIF call centre in Johannesburg. Picture: Kayleen Morgan/EWN

JOHANNESBURG - The National Economic Development and Labour Council’s (Nedlac) social partners are set to review the Unemployment Insurance Fund’s (UIF) technical and financial capacity to continue providing funds to businesses and workers through the COVID-19 temporary relief scheme.

A meeting will be held on Thursday between the Department of Employment and Labour, along with Nedlac constituencies including labour, business, and government.

The UIF is the financial backbone of government’s labour market response to the distress caused by COVID-19, which resulted in many having to go without salaries.

Since April, the UIF paid over R15 billion to over two million beneficiaries. That was an unprecedented amount of claims payments paid by the agency in its history.

While at the beginning of the crisis the UIF said it had set aside R40 billion in its budget for COVID-19 related claims, it also acknowledged that it had experienced a remarkable spike in the number of applications.

In a statement released by the Department of Employment and Labour, Minister Thulas Nxesi said the impact of the pandemic would be felt for some time, despite the easing of the lockdown to level 3.

The department expected an increase in labor-related disputes due to retrenchments and termination of employment, which he said would place a further strain on their ability to meet their social security obligation to the public.

For official information about COVID-19 from the Department of Health, please click here.