Business Unity SA (Busa) has called for the Unemployment Insurance Fund (UIF) to be placed under immediate administration, citing systemic dysfunction and deep corruption within the organisation.

The UIF is intended to provide financial support to workers in the event of unemployment, reports BusinessLIVE.

The assets of the UIF, which are invested on its behalf by the Public Investment Corporation, amounted to R135bn as at end-March. It is funded by a levy paid by employers.

In a statement yesterday, Busa CEO Cas Coovadia said UIF commissioner Tebeho Maruping had failed to address the systemic issues and Employment & Labour Minister Thulas Nxesi had not responded positively to several Busa letters.

He called on Nxesi to act speedily to address the issues.

‘Failure to address the systemic issues, including alleged corruption, will result in increased frustration among employers and employees, and in greater financial losses that could impact the sustainability of the fund. Busa supports the call by other business organisations and organised labour to have the UIF put under immediate administration,’ he said.

Questionable investments had put at risk billions of rand that should be allocated to workers in distress at a time when poor economic conditions are likely to lead to employees being placed on short-time or potentially even laid off.

‘For impacted individuals, the safety net afforded by the UIF benefits scheme is not guaranteed,’ Coovadia said.

TimesLIVE reported in September that Nxesi had ordered a judicial review of the UIF's controversial award of a R5bn investment in a company, Thuja Capital, which at the time existed only on paper.

Full BusinessLIVE report