Home South African Nearly 600,000 workers join the queues of the unemployed

Nearly 600,000 workers join the queues of the unemployed

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The UIF says that 578,677 workers who claimed Ters benefits have now joined the ranks of the unemployed

Unemployed people queue to sign up for UIF benefits.Picture: Oupa Mokoena/African News Agency (ANA)

NEARLY 600,000 employees who had previously claimed the Temporary Employer-Employee Relief Scheme (Ters) benefits have now lost their jobs.

The Unemployment Insurance Fund (UIF) said this week that 578,677 of those who claimed Ters have joined the queues of the unemployed.

UIF spokesperson Makhosonke Buthelezi said that the fund paid 1,787,268 beneficiaries more than R10 billion between March 26, 2020 to 19 January 19, 2021.

“However, reports from the CCMA show that this has increased by 40 percent, posing a claims increase for UIF,” said Buthelezi.

The UIF said an increase of 40 percent in Section 189 and Section 189A notices could result in additional normal unemployment claims.

It said it expected an increase in the claims for unemployment benefits.

Buthelezi said that the massive job losses had a huge impact on South Africa’s economy, citizens and families.

“When workers are retrenched or companies close down, it has a substantial and detrimental knock-on effect which includes a reduction in tax revenue collection,” Buthelezi said. “It also affects the Fund’s revenue as contributions decline, while claims increase.”

In September, Statistics South Africa said that its quarterly labour force survey showed that 2.2 million more people lost their jobs in the second quarter.

Trade union federation Fedusa has called for a moratorium on all retrenchments and future potential processes. Fedusa said it believed that all possible avenues should be considered “instead of continuously using workers as scapegoats”.

Fedusa general secretary Riefdah Ajam said the SA Reserve Bank (Sarb) needed to apply the same amount of conviction in 2021 to continue to catalyse the soft landing, stability and liquidity to assist workers entrapped in debt due to the lockdown.

“Although Sarb was very instrumental in the process, it needs to continue on this trajectory, as the Loan Guarantee Schemes (LGS) and tax relief measures have yet to deliver the results that were promised, considering that only a meagre R15 billion of the R200 billion capacity relief to SMMEs were provided,” said Ajam.

FNB said it had paid over R200 million worth of retrenchment claims thereby aiding in protecting customers against financial losses as a result of retrenchment.

FNB Life head for Credit Life Heetal Govindjee said that due to the uncertainty in the market, it was very difficult to anticipate what will happen going forward.

“We are still observing higher retrenchment levels than prior to March 2020 but have seen a marked decline in retrenchment rates since May last year.”

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