UIF ‘addressing systemic challenges’

The acting Unemployment Insurance Fund (UIF) commissioner Marsha Bronkhorst has said the fund was already addressing deficiencies picked up in the system from June; before the Auditor-General (AG) of South Africa’s shocking report last week, which identified poor financial management and verification controls within the unit.

Read: UIF Ters benefit payments suspended based on AGSA’s report – again

Bronkhorst said this in a statement on Friday afternoon explaining why the payments for the new and outstanding applications for the Covid-19 Temporary Employer-Employee Relief Scheme (Ters) had been suspended until further notice.

 “Whilst the AG has shown us a number of deficiencies in the payment of the Covid-19 Ters benefits, I must hasten to add that many of these deficiencies had been picked up already by management. Some had already been corrected in the June payments, but we will continue to improve the systems so that it responds to [the] needs of our beneficiaries and makes the payments effective and efficient,” Bronkhorst said.

“First of these is that we have entered into a Memoranda of Understanding with a number of government institutions to make sure we get access to their updated databases.

These include institutions such as the South African Social Security Agency, National Students Financial Aid Scheme and the Department of Home Affairs. These departments and institutions are currently busy verifying the UIF database to ensure payments reach the correct persons.”

Bronkhorst said that the fund has updated its system to make sure that the bank verification happens quicker. These include verifications for schools, and NGOs.

“We are also working hard currently improving our Covid-19 Ters application portal to make sure that to the extent possible, it becomes a self-service portal to make it easy for employers and employees,” she said.

Bronkhorst is upbeat that the system should be up and ready to help workers as soon as possible to provide financial relief especially to those who are still under lockdown conditions.

“As soon as the improvements are finalised, we will be in a position to ensure that workers of this country are provided a cushion to make their lives easier,” Bronkhorst said.

Bronkhorst took over as the acting UIF commissioner after Employment and Labour Minister Thembelani Nxesi suspended four officials including UIF commissioner Teboho Maruping, the COO, the CFO and the head of supply chain management. The suspensions followed the AG’s report which found that the fund had paid millions of rands for the months of April and May to deceased people, those imprisoned and minors.

Before the AG’s full report was released last week Wednesday, the fund had once again suspended funding on the August 25, citing “identification of control deficiencies within the Ters system” picked up by the AG.

When asked by Moneyweb if these corrections were not made to the system before the AG’s full report was released, the Unemployment Insurance Fund (UIF) spokesperson Makhosonke Buthelezi said: “After the comprehensive report was released last week we realised that we need to stop the payments to address the issue once and for all instead of [in a] piecemeal fashion”.

He pointed out that the Ters system was developed in a week, therefore “there was really no time to pilot it”, which is why it has been experiencing technical challenges.

“The other thing is that we’ve had a number of directives and every time the directive is updated, we’d also have to align the system with the [new] directive,” Buthelezi said.

To date the UIF has received just over 1 million applications and has paid R42 billion to 825 840 of these.

Bronkhorst warned those who defrauded the system that they will be dealt with by the law.

“There are already some cases that we have brought to the SAPS for investigation and prosecution – 35 out of a total of 146. This also serves as a notice to those who may have intentions to try and defraud the system. Not only will it be harder to do so, but even if they do succeed, the law will eventually get them and they will pay for stealing from the workers,” Bronkhorst said.

Bronkhorst added that the Special Investigating Unit (SIU) has started with its investigation into fraudulent claims and action will be taken against all found involved in fraudulent activities.