R10bn in TERS benefits for the Western Cape

NATIONAL NEWS - In a briefing called by the Western Cape Standing Committee on Finance, Economic Development and Tourism on the COVID-19 TERS payments by Unemployment Insurance Fund (UIF) it was revealed that R10.4 billion has been paid over to 54 981 businesses between April and December 2020 as part of the UIF Covid-19 Temporary Employee/Employer Relief Scheme (TERS) in the Western Cape.

Through their successful efforts, 1.1 million employees have received TERS payments but now much work is needed to audit each business and ensure that benefits reach successful applicants.

In total, the UIF received more than 2.8 million applications. More than 1.7 million applications were thus unsuccessful due employer failure to declare and register employees timely and the inability to verify bank details, amongst others.

The personal services sector in the Western Cape, which includes the hospitality industry, hair dressers and other beauty technicians, received the largest portion of support at R3.34 billion.

MPP Deidré Baartman comments: “While the UIF should be commended for its work in paying out R59.18 billion between April and December 2020 to the country as a whole, currently, an estimated R3.84 million has been associated with fraudulent activities in the Western Cape, only approximately R250 000 of this money has been recovered. This amount is alarming and the Committee has requested that the UIF submits the police case number in order for the Committee to monitor the UIF’s progress in recuperating the funds.

My greatest concern is that there appears to be a high level of non-compliance by businesses in registering their employees and the apparent manipulation of the application process. The TERS was meant to be a stop gap measure to ensure that businesses kept their doors open and as social responsibility measure to employees during economic upheaval.

Any business that has been non-compliant or committed criminal activity must be held accountable for those actions – it is at the end of the day theft of relief grants.

Consequently, the UIF launched its Follow-the-Money Project which will use 7 audit firms to verify the expenditure of all TERS funds and confirm that money was paid over the intended beneficiaries.

As Chairperson I have already recommended that the UIF partners with the Department of Trade, Industry and Competition; the South African Revenue Services and the Department of Planning, Monitoring and Evaluation integrate their respective systems in order to cut red tape for employers and employees alike.

Employers and employees are entitled to receive their benefits in a speedily fashion without the rigmarole of submit a duplication of documents to various entities who are part of one government.

As part of our oversight responsibilities, the Standing Committee on Finance, Economic Development and Tourism in the Western Cape will hold a public meeting where we encourage employees and employers to share their experience regarding the UIF Covid-19 TERS benefits. Our hope is that with the input from the public, we might be able to find the best ways to assist the deserving residents of the Western Cape.”