Business Unity South Africa (Busa) believes that the great systematic dysfunction and alleged corruption at the Unemployment Insurance Fund (UIF) warrants placing the entity under immediate administration, which would mean a complete management overhaul.
The business body called out the UIF this week for its poor systematic processes, which have manifested as lengthy delays in application processes and payout times, leading to the breakdown of employer and employee relationships.
According to Busa, the organisation, along with labour union formations, has made attempts over the last three years to engage the government to find solutions to the inefficiencies at the UIF, but it has come up empty.
The business body said it suggested a modernisation of UIF systems that would cut down the avenues for actors to cheat the system, which it said would necessitate an overhaul of the UIF’s ICT systems.
“These engagements have been going on for the last three years, and no progress has been made due to the inability or unwillingness of the UIF Commissioner to address the systemic issues,” Busa CEO Cas Coovadia said in a statement.
“Busa has also written to the Minister of Employment and Labour several times, but we have not received any positive responses,” added Coovadia.
Busa’s views come weeks after Moneyweb’s own reporting on the dysfunction at the state entity, detailing the frustrations of employees struggling for more than a year, in some cases even longer, to receive their UIF benefits. The UIF has yet to provide an explanation of the main causes of dysfunction at the entity.
“It is clear the current management within the UIF is unwilling or unable to execute their mandate and has embarked on ill-considered systems, such as the eCompliance platform, which have failed and introduced risk in the business landscape, both for companies seeking assurance about the compliance of their providers and for the protection of workers,” Coovadia said.
“Failure to address the systemic issues, including alleged corruption, will result in increased frustration amongst employers and employees and in greater financial losses that could impact the sustainability of the fund,” he added.
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