UIF criticises Busa’s withdrawal from governance forums
· Citizen
The Unemployment Insurance Fund (UIF) has defended its governance processes and reiterated its commitment to social dialogue after Business Unity South Africa (Busa) withdrew its representatives from the UIF board and related National Economic Development and Labour Council (Nedlac) structures.
The fund on Friday said it respected Busa’s decision to leave the statutory bodies but maintained that meaningful governance reform could only be achieved through continued participation rather than disengagement.
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“The UIF notes the decision by Business Unity South Africa (Busa) to withdraw its representatives from the UIF board and related National Economic Development and Labour Council (Nedlac) structures,” the fund said.
“It is common cause that participation in these statutory governance forums remains the prerogative of each social partner.”
UIF defends governance processes
The UIF said it had consistently engaged “in good faith and utmost professionalism” and believed public governance responsibilities were best fulfilled through “continued engagement, constructive dialogue and adherence to established institutional processes”.
According to the fund, the UIF board and Nedlac are governance structures that were established to promote consultation, accountability and consensus-building on labour market, social security and economic development issues.
“These structures are intended to provide an institutional social dialogue platform, through which diverse and differing views are debated,” it said.
“It is through social dialogue that evidence is considered, and policy positions are refined in the interest of the public.”
The UIF argued that withdrawing from these forums reduced opportunities for stakeholders to shape governance outcomes through the very structures created for that purpose.
“Regrettably, withdrawal from these forums limits opportunities to influence governance outcomes through the very mechanisms established for that purpose.”
Fund outlines reforms and concerns
The UIF said it had used governance engagements to advance proposals aimed at strengthening institutional governance, improving employer compliance with unemployment insurance legislation and enhancing service delivery.
It also advocated policy reforms that would enable the government to respond more effectively to economic shocks affecting employment while supporting job preservation and labour market participation.
However, the fund said some proposals submitted by Busa required additional information before they could be properly considered.
“Unfortunately, the proposals by Busa… needed further information to engage further on,” the UIF said, adding that the suggested changes to benefit processes were “not in line with the UIF process”.
Focus on benefit payments and transparency
The UIF said it had proposed reviewing the Nedlac task team’s terms of reference to reflect current labour market conditions, noting that the committee had originally been established during the Covid pandemic.
Among the priorities identified by the fund were improving the speed of benefit payments by addressing delays caused by employers failing to submit accurate and up-to-date employee declarations, expanding access to UIF services, improving communication with workers and employers, and supporting initiatives to revitalise the labour market amid persistently high unemployment.
The fund also committed to exploring the publication of the names of Labour Activation Programme (LAP) partners and presenting the LAP Impact Report to Nedlac once it is finalised during the current financial year.
Addressing concerns about reporting, the UIF said quarterly performance reports undergo rigorous internal quality assurance and validation, warning that producing them monthly could compromise their quality and reliability.
UIF urges continued engagement
The UIF said it remained committed to transparency, accountability and compliance with the Public Finance Management Act and unemployment insurance legislation.
“The UIF does not believe that disengagement is the most constructive approach to addressing the challenges facing the fund or the South African labour market.”
It added that the challenges facing the fund required “continued collaboration and focused discussions among all social partners to develop practical and sustainable solutions”.
Rejecting claims that governance reforms could be achieved outside statutory structures, the UIF said: “Robust debate, differing perspectives and critical scrutiny are integral components of good governance. However, these objectives are best realised through active participation in governance forums rather than withdrawal from them.”
The UIF said it remained available to engage any stakeholder committed to improving labour market outcomes, strengthening institutional governance and enhancing service delivery for workers and employers.