The government is dragging its feet on the announcement of a decision on the Covid-19 wage protection scheme, despite the uncertainty it has raised in business and labour sectors.
Business 4 SA (B4SA), a lobby group formed in the wake of the Covid-19 outbreak to help the government with policy responses, earlier this week raised concerns that the national coronavirus command council had taken a unilateral decision not to extend the scheme.
This was despite a commitment made by President Cyril Ramaphosa that the aid would be available until the end of the state of disaster, which has been extended to November 15.
Business Day was reliably informed that at a National Economic Development and Labour Council (Nedlac) meeting held on Tuesday social partners raised issues with the lack of clarity on the Temporary Employer/Employee Relief Scheme (Ters) for tourism and the liquor industry.
Social partners want Ramaphosa to intervene in the matter.
A Nedlac committee met later on Tuesday afternoon with acting Unemployment Insurance Fund (UIF) commissioner Marsha Bronkhorst over the issue of the extension of the Ters benefit.
The UIF, however, was still waiting for formal communication from employment & labour minister Thulas Nxesi or the national coronavirus command council, a source close to the process said.
The Ters benefit was introduced in March to help employers in distress provide wage benefits to employees via the Unemployment Insurance Fund. It was initially to run for three months, from April to June, and was one of the main pillars of Ramaphosa’s R500bn Covid-19 relief package. The scheme was then extended by the government from August 16 to mid-September.
Last week, the UIF said it had paid out more than R51bn in Ters benefits to just over 1-million companies that applied and was disbursed in more than 11.5-million payments.
If the government was to extend the Ters benefit to the end of the year, it is understood that it would cost about R12bn.
There have been concerns over the ability of the UIF to meet the growing demand for benefits amid escalating retrenchments as a result of a rapid contraction of the economy.
But labour and business have urged that the benefit be extended for those categories of workers who are restricted from working under level 1 of the lockdown regime for as long as the state of disaster continues.
Lawyers close to the process said the government could find itself in a legal problem because the current directive, which is still in force, makes it clear that Ters would “remain in operation for as long as the declaration of the Covid-19, in terms of the National Disaster Manager Act, 2002 (Act No 57 of 2002) as a national disaster subsists or until withdrawn by the minister”.
It was silent on time periods, and was in line with Ramaphosa’s public pronouncements that the benefit would be extended until the end of the national state of disaster.
“If our interpretation is right, then beneficiaries have a vested right to benefits from September 15 until the directive is withdrawn. The minister has to formally withdraw the directive. This will give cover from September 16,” the lawyers said.
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