Statement by Nqabayomzi Kwankwa, UDM Deputy President and Chief Whip

Tomorrow’s Phase 1, the provincial rollout in Gauteng, of Employment and Labour Minister Thulas Nxesi’s pet project, the Labour Activation Programme (LAP) and the rest of the provinces to follow nicely in line right before 29 May 2024. Perfect timing indeed. What is clear is that this is designed to be an elections campaign R23 billion marketing project. It is very telling that it has been billed as “plans to create employment opportunities” not creating sustainable employment and enterprises.

Apparently, money invested in this plan would be recouped by the UIF through contributions and revenue generated from investments. How does the UIF recoup monies from employment opportunities? Real jobs and real enterprises are required for real contributions and real revenue to be made to the UIF.

The United Democratic Movement (UDM) is on record regarding the matter of using funds like the Unemployment Insurance Fund (UIF) and the Public Investment Corporation (and therefore by default the Government Employees Insurance Fund), for these hair-brained schemes of the ruling party, where they try to use funds meant for one clear purpose to address another problem (like bailing out State-Owned Enterprises). With the PIC, workers’ money is constantly being lost in cases where extended loans are not being paid back and are written off.

Furthermore, the UIF is in shambles, where retrenched workers are shown the door without their benefits being paid out.

Administrative inefficiencies at the UIF, including delays in processing claims and disbursing payments to beneficiaries, cause many problems. These delays often exacerbate the financial hardships faced by unemployed individuals who rely on these funds for support.

Fraud and corruption allegations within the UIF cast a dark cloud, with Nxesi being personally implicated amongst others in a R3 billion scandal. A UIF staffer is reportedly placed in a witness protection programme amidst numerous reports of irregularities in the allocation of funds and fraudulent claims. This misuse of resources not only undermines the integrity of the UIF but also deprives deserving beneficiaries of much-needed support.

The long-term financial sustainability of the UIF, particularly in light of high unemployment rates and economic challenges facing South Africa concerns. The R23 billion, Acting Director-General Onke Mjo, mentioned in media interviews was from the surplus funds of the UIF. The Fund’s viability must be ensured through careful management and sufficient resources to meet the needs of unemployed individuals while maintaining fiscal responsibility.

The UDM therefore is wholly not in favour of training and employment creation opportunities, doubting the bona fides of the project and its timing. We desperately need is an Employment Policy underpinned by Productivity and Competitiveness principles for viable LAP job creation in the country.

Issued by:
Mr Nqabayomzi Kwankwa, MP
Deputy President and Chief Whip of the United Democratic Movement