The payment of the government’s Covid-19 relief scheme, which ensures workers affected by the lockdown receive much-needed money, has been halted pending an investigation by the auditor-general.
Business for SA (B4SA) on Wednesday said its representatives at the National Economic Development and Labour Council (Nedlac) informed it of the suspension of payments and that it was understood that the auditor-general was looking into system integrity problems at the Unemployment Insurance Fund (UIF), which funds the Temporary Employer/Employee Relief Scheme (Ters).
The Ters was initially envisaged to cover April, May and June and was established as a key part of the government’s R500bn economic and social relief package to help those affected by the lockdown.
It was announced in July that the Ters benefit would be extended for an extra six weeks until August 15.
However, the opening of applications was delayed because a government directive had not been signed and published. This was not the first time applications had been delayed since the implementation of the scheme.
The Ters system was also hit by a glitch that showed applicants’ confidential information.
The UIF has been adamant there is no backlog in paying the benefits, despite workers and employers left waiting for payments. By mid-July, some workers and employers were still waiting for payments from April and May.
B4SA said none of the “already significantly delayed” payments on claims for July/August had been made and the catching up on the backlog payments going back as far as April had also been halted.
The organisation said it was disappointed that payments had been stopped.
“B4SA strongly supports the mitigation of fraud risks, and urges that criminal charges should be brought against all alleged perpetrators,” it said.
“However, the unilateral halting of all payments, and the very poor communication of the situation by the UIF leadership, is grossly unfair to all employees and their employers who have legitimate claims. That the UIF system is incapable of remedying the relatively small number of fraudulent claims without disadvantaging the millions of legitimate claimants is an indictment on the UIF system.”
The UIF said it would respond to questions regarding the suspension of the payments later on Wednesday.
B4SA said it understood that after investigations. and flags raised by the auditor-general, measures had been put in place to mitigate risk, and assess and improve data integrity.
However, it was not clear how long the process would take.
It urged the government to resume payment of all active claims as soon as possible.