Government fails retrenched workers

25 August 2014

In a reply to a DA parliamentary question the Minister of Labour, Mildred Oliphant, has revealed that only R20.056 million of the R1.2 billion budgeted for the Training and Layoff Scheme, or 1.7%, has been made available towards capacitating employees facing unemployment. 

I will write to the Minister of Finance, Nhlanhla Nene and Minister Oliphant, demanding they present a plan to parliament to improve the Training and Layoff Scheme. I will also submit a series of parliamentary questions to obtain an explanation for why such a small proportion was used towards job creation.

Indeed, the Training and Layoff scheme is designed to incentivise employers to up-skill workers during an economic downturn, rather than retrench them. The scheme offers training layoff as a means to re-skill workers to retain employment levels.

But this hasn't been happening. For example, 8 companies in East London almost had to fire all their staff when Mercedes Benz shut down temporarily for retooling. The companies were unable to access training lay off funds due to the excessive bureaucratic processes. A crisis intervention by the CCMA and others had to be rushed through to get the funding approved before the East London Economy shut down. 

It is clear from the Minister's response that very little is being done to ensure the appropriate spending and functioning of the scheme. 

By 2011, less than 1% of the 9 00 000 workers who had lost their jobs between 2009 and 2011, had benefited from the scheme.

With 7 573 000 unemployed South Africans, it is condemnable that government has failed to make the Training Layoff Scheme funds available for workers facing retrenchment.

We trust that the Minister will adhere to our request to turn around this sad state of affairs. 

Our priority as a nation must be to create jobs and grow our economy so that we can lift our people out of poverty.

The DA is committed to making sure that this happens.

922. Mr I M Ollis (DA) to ask the Minister of Labour:

(a)    What amount of money is in the Training Layoff Scheme fund

Minister of Labour reply:

The Training Layoff Scheme is not a separate fund. The UIF has set aside budget over the MTEF period for the Scheme.

The UI Board recommended to the Minister of Labour who approved on 23 September 2009 to commit R1.2 billion of the

Funds money for the "Training Layoff Schemes".

Initially the committed R1.2 billion was budget for expenditure over the following years:-

• 2011:   R200 million
• 2012:   R400 million
• 2013:   R105 million
• 2014:   R120 million
• 2015:   R180 million
• 2016:   R195 million

Due to slow take-up in the scheme, the budget had to be provided for in future years. The 2015 MTEF budget reflects the following provision for the scheme:-

(b)   what amount was distributed per annum from the date of commencement of the fund,

Minister of Labour reply:

(c)    what individual payments have been made from the fund in the past 12 months for training and related activities

Minister of Labour reply:

The R1.2 billion committed by UIF for the Training Layoff Scheme is specifically for training allowances (stipends) to be paid to the

employees that have been put on training. The UIF does not fund any training costs to training providers in this scheme.

 and (d) to whom were these payments made?         

Minister of Labour reply:

As the UIF did not make payment for any training cost, no training providers were appointed and paid by the UIF.

Statement issued by Ian Ollis MP, DA Shadow Minister of Labour, August 25 2014

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