Labour minister Thulas Nxesi says the government can’t afford to fund another extension of the Temporary Employment Relief Scheme (TERs). He said because most companies have resumed operations under level 1 lockdown, the fund will not run after March.
“Whatever extensions we have done was as a result of the pressing situation for those workers to have livelihoods. We had to make the means, tap from other sources which were meant for other programmes of the UIF. But, given the crisis of this situation, we had to go into those sources,” he told MPs on Thursday.
The minister added the scheme was under immense pressure financially because it also benefited employees who did not contribute to the UIF fund.
“The reason we wanted to quickly do away with Ters was that this was a special programme which covered even the people who did not pay but their employers had to sign an acknowledgment of that, and we are following them,” he said.
President Cyril Ramaphosa announced the extension of the scheme during his state of the nation address last month. He said this was done to support employees whose companies had not reopened.
Asked why the department agreed to the extension, Nxesi said the department was confident it would afford it because most beneficiaries had returned to work and the demand had declined.
“We continued to communicate with our actuaries as to what was possible, what was impossible and where would we cut. One of the reasons we were comfortable with the extension until March 15; we were looking at the sectors that had not opened.
“Remember those people who were affected had never been able to reopen. We were looking into those and when we quantified that, we came to a conclusion the numbers had gone down,” he said.