UIF moving along slowly with Covid-19 relief payments
Some workers and employers are still waiting for their money from April and May
There has been little movement on the payment of arrears in Covid-19 relief benefits for April and May despite the Unemployment Insurance Fund (UIF) finally paying out R1.6bn for June applications.
The June applications for the relief had also been delayed, this time because of a glitch in the system that showed applicants’ confidential information.
The UIF said the system was able to process and pay applications for June around July 6 in instances where the employer had selected to have payments made directly to employees.
The reason it had not started processing cases where the employer selected to have funds paid into their account was due to the introduction of a new rule that required the validation of accounts with banks, as well as validation with the Companies and Intellectual Property Commission in the case of companies, it said.
The temporary employer/employee relief scheme (Ters) was established as a key part of the government’s R500bn economic and social relief package to help those affected by the lockdown, which is set to push the economy into its biggest slump in about a century.
The UIF has been adamant there is no backlog in the payment of the Ters benefits, but some workers and employers are still waiting for payments from April and May.
The fund said over the past weekend it paid R372m to 15,866 employers covering 78,282 employees for those two months.
It said there were many reasons some were still waiting for payment, but mostly because of undeclared employees who were not registered with the UIF by their employers. In other cases, there were invalid and incorrect ID numbers, or employers indicating that the employee was receiving a full salary during lockdown, and, in some cases, the employee having an “active” UIF claim.
According to a report seen by Business Day, as of June 30 just over R19.3bn had been paid for April. On Wednesday, the department said the UIF had paid out R19.6bn for the month, a slight rise since June’s reported numbers.
The department said the number went down in May, which coincided with the easing of the lockdown and parts of the economy opening up. Only R9.7bn was paid out in that month.
Robert Legh, chair of B4SA’s team on the labour market, said there were “significant ongoing frustrations in relation to the backlog in the system”, but the organisation was pleased to see applications and payments for June seemed to be open and money seemed to be flowing.
The department of employment & labour & employment on Wednesday said 409,647 employees had received the June payment, with close to 18,000 employers having lodged valid claims.
The UIF has set aside R40bn for the Ters scheme and since April 16 has paid out about R31bn to almost 7-million workers from more than 500,000 employers.
There was, however, still about R4bn stuck in the system in relation to almost 1-million people who were not found on the UIF system. The fund has said these are employees who were not declared by their employers.
The UIF said it had not set a timeline for when it will complete all Ters payments, and that a cut-off date would be determined at the National Economic Development and Labour Council (Nedlac). However, the fund said it had decided to make Ters payments twice a day to fast-track the payments.
The department of employment & labour & employment said it was on its way to fulfilling its commitment of providing R40bn towards Covid-19 relief.
“It is a massive project that is outside of our normal scope. But despite all the teething problems, we have managed to stretch our human and financial resources to ensure that we play a critical role in contributing towards improving the economy when we are expected to,” it said.
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