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BUILDING SKILLS: Skills development is central to the reduction of unemployment and poverty alleviation
The Unemployment Insurance Fund (UIF) is arguably South Africa’s biggest provider of social insurance for workers and youth graduates entering the workforce.
With the economy experiencing huge challenges such as low economic growth and the highest rate of unemployment recorded in recent times, the fund must shore up its services to soften the hard effects of the marketplace.
UIF leadership, recognising the increasing importance of its social mandate in a country with extreme levels of poverty, is working harder to make its services more efficient and responsive to the needs of the people it serves.
“My goal is to help enhance the UIF as a caring organisation that delivers poverty relief at the right time, to the right individual, every time,” says Teboho Maruping, the Acting UIF Commissioner, a designation meaning he is the CEO of the organisation.
“As part of this vision, I intend to drive greater self-service whereby customers can access our services from the comfort of their homes or wherever they may be. For example, we should be leveraging the convenience of apps for people to access our various services, instead of potentially spending an inordinate amount of time at our labour centre. So we plan to develop an app in the next 18 months,” he adds.
“Another goal is to promote the notion of ‘first-time resolution’ whereby we should process claims or queries at the first go, instead of clients navigating different queues to receive actual assistance. Whether applying online or in person at any labour centre, our customers should be able to complete claim applications in one seamless transaction,” he says.
“To this end, my leadership team will start having a greater focus on facilitating quicker turnaround times for implementing our training and job preservation schemes. So both the employee and employer should receive our assistance at the exact moment they need it and not at a later stage, when the intervention may be less effective,” he concludes.
As the government’s main deliverer of social insurance, UIF provides unemployment benefits to individuals when they become unemployed and cannot work because of maternity, adoption leave, or illness. It also assists the dependants of deceased persons who have contributed to the fund.
The fund pays out R30-million PROUD ACHIEVEMENT: Minister of Labour Mildred Nelisiwe Oliphant with some of the trainees from VWSA who are the beneficiaries of UIF's training schemes daily. On average, it pays R7-billion a year. In the 2015/16 financial year, it paid out R7.7billion, according to the UIF.
Money used to pay unemployment benefits comes from levies collected by the UIF from employers.
The UIF’s social mandate is broader than just providing unemployment benefits. The fund also invest in poverty alleviation, job-training projects and socially responsible investments (SRI), such as skills development, education and housing, and other initiatives that support job preservation and job creation.
According to the UIF’s 2015/16 annual report, the fund generated a surplus of R10.6-billion because revenue collected and investment returns exceeded benefits paid.
The report further states the combined impact of the SRI investments resulted in more than 8 436 jobs nationwide, as the table below illustrates:
Maruping says the UIF’s SRI investments are guided by the government’s economic and social development objectives, which are summed up in the policy document, the National Development Plan or NDP.
“We use the NDP to pinpoint which challenges to combat and determine the sectors to invest in. Based on clearly defined criteria and investment mandate, we allocate funds to the PIC to realise an appropriate return, both in terms of financial growth on our investments, and record the number of jobs created or number of people who received training,” says Maruping.
The Public Investment Commission, known as the PIC, is the government’s designated investment manager.
“We try as much as possible to facilitate initiatives that support job creation and job preservation to reduce the likelihood of people falling into joblessness or the poverty trap,” he adds.
The duration of the povertyalleviation schemes and socially responsible initiatives varies, depending on the nature of the project. For example, the poverty-alleviation schemes typically involve skills or job-training accredited courses that take between six to 18 months to complete through technical vocational education and training colleges, and sector education and training authorities (SETAs).
Social responsibility investments normally entail infrastructure projects completed over several years. One such project the fund capitalised is the private 220-bed hospital in Modderfontein, Ekurhuleni. The facility’s Orthopaedic and Oncology ARTISANS: UIF targets to train 265 artisans in partnership with the Transport Education Training Authority in motor mechanics, panel beating and spray painting
Our training schemes give graduates skills to enter the job market
To combat the adverse effects of the 2008 global economic crisis on the South African economy,