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Date: 08 May 2012
Title: UIF, Compensation Fund helps firms create thousands of jobs
Cape Town - Government is making billions of rands off the reserves it has locked up in the Compensation Fund and the Unemployment Insurance Fund available for investment in businesses, to create thousands of new jobs, the Minister of Labour, Nelisiwe Oliphant says.
Presenting the Department of Labour's Budget Vote speech in Parliament on Tuesday, Oliphant said the first two of four bonds - valued at R1 billion and generated from reserve funds lying in the UIF and issued by the Industrial Development Corporation (IDC) - had helped the IDC to invest in businesses that have created 15 056 jobs and saved a further 18 637 jobs since August last year.
Oliphant said in addition to the R2 billion five-year private placement bond that was issued by the IDC, and in turn subscribed by the UIF in 2010, the UIF had approved in principle four additional bonds of R500 million each to be registered by the IDC and taken up by the UIF.
The first R500 million bond was approved in August last year and the second and third bonds were approved in December - making a total amount of R1.5 billion in socially responsible investments available.
"These funds are available to start-up businesses and also support the expansion of existing businesses," said Oliphant.
The Compensation Fund, which currently has R28 billion in investments with reserves of R15 billion, had last year allocated five percent of its total investments, or R1.4 billion, to socially-responsible investments which had helped create jobs and develop infrastructure.
Oliphant said the department would review its current investment mandate with the Public Investment Corporation (PIC).
"A certain percentage of the current billions reserves should be invested in projects that are more biased towards employment-creation projects.
"Within a year or two, the Minister of Labour should be able to stand before this House and report on the total numbers of jobs created as a result of deliberately changing the investment mandate," said Oliphant.
Turning to the Training Lay-Off Scheme, she said the department had signed R31.1 million in funding agreements since the inception of the scheme in 2009 and up to 31 December 2011
In all R9.6 million in training allowances had been paid to participating employers and employees.
Through the Training Lay-off Scheme, the Fund has assisted 18 companies and 4 330 workers, she said.
An amount of R600 million had been budgeted for the Training Lay-Off scheme over the next three years.
Oliphant said the National Skills Fund (NSF) had been budgeted an amount of R210 million in the last financial year of which R19.5 million had been spent as at end December 2011.
In all R660 million has been budgeted for various training and re-integration schemes over the next three years, the minister said.
Meanwhile, the Labour Relations Amendment Bill 2012 and the Basic Conditions of Employment Bill 2012 were expected to be passed in Parliament this year, while amendments to the Employment Equity Act and the new Employment Services Bill were currently being considered by Nedlac.
She said once the amendments to the two Acts had been promulgated, the government would for the first time, be enhancing protection to cover those workers who work in temporary work, in part-time work and on fixed-term contracts.
Oliphant added that the number of atypical employees had grown from 1.5 million to 3.89 million between 2000 and 2010 - about 28% of employees. - BuaNews