The Unemployment Insurance Fund (UIF) is to become a government agency with assigned powers, the Department of Labour said on Tuesday.
”This means that the UIF will become an autonomous organisational component in the public service, but will still remain a statutory body of the department,” Minister of Labour Membathisi Mdladlana said in a statement.
”Preparations to transform the UIF into a government agency are on track and I want to reassure staff that they will not lose their jobs as a result of this new development.”
He said a key advantage of the transformation will be improved service delivery through dedicated resources and infrastructure.
”The fund’s powers are in the process of being delegated to the unemployment insurance commissioner, who will become responsible for UIF activities, while the director general of the department will remain the accounting officer.”
The fund’s financial and non-financial performance over the past few years has been ”impressive”.
”The fund has moved from a surplus of R121-million in the 2003/04 financial year to a surplus of R2-billion in the 2004/05 financial year.
”The UIF, which paid benefits amounting to R2,5-billion in the 2004/05 financial year, has built more than R10,6-billion in assets,” said Mdladlana.
The fund has also been declared financially sound on a cash-flow basis for the next 10 years.
”In an effort to ensure effective financial management of the fund, a chief financial officer and four senior managers were hired to look into this.”
While progress is being made to transform the fund into a government agency, a lot of work still needs to be done, Mdladlana said. — Sapa