Business leaders and labour unions have raised the alarm over the state of the Unemployment Insurance Fund’s (UIF’s) systems, which they say are collapsing.
Speaking to 702, the Congress of South African Trade Unions (COSATU) Parliamentary coordinator, Matthew Parks, cited IT problems, widespread fraud, and a lack of transparency as factors in its demise.
“The difficulty is that the fund is failing to fulfil its mandate to workers. It’s a systemic failure. When employees register a worker, they struggle with the IT systems,” Parks said.
“When workers try to apply, they also struggle. They go to labour centres across the country and find queues stretching into the hundreds of people.”
He added that some workers might have to wait three or four days to be assisted because the UIF’s IT systems frequently go offline, adding that they may wait months or even years to receive UIF benefits.
Parks added that inefficient systems and a lack of transparency enable corruption to thrive, alleging that criminals submit fraudulent claims as both workers and employers and take the money.
“The UIF also invests in labour activation programmes. Often those schemes themselves are riddled with tenderpreneurship with collusion with inside interests,” he said.
He added that many workers trying to register to claim benefits are frustrated by the UIF’s lack of transparency.
“They go and claim the benefits and find out that there’s no money there for them despite having contributed for years,” Parks said.
“So if the systems are efficient and transparent like a pension fund system, workers could go and check online and say: Yes, John has paid my monthly contribution this month. I’m safe.”
He explained that, as a result, many workers fall through the cracks and give up on claiming benefits because they can’t afford to sit in a queue for days in the hope of getting lucky.
uFiling goes offline for over a month in 2024
The Department of Labour’s uFiling platform went offline for more than a month in mid-2024, preventing users from accessing the system to declare and pay UIF contributions.
The fund acknowledged the issues in a statement, saying the platform was down due to a Pretoria High Court interim interdict that prevented a service provider from signing a new contract to support it.
“The court issued an interim interdict preventing, with immediate effect, the new service provider from rendering services for the UIF online portal,” Labour Minister Nomakhosazana Meth said.
“As a result, the UIF online platforms that are currently disrupted include uFiling, Unstructured Supplementary Service Data (USSD), Virtual Office, as well as the UIF Covid-19 TERS systems.”
UIF communications director Trevor Hattingh explained that the previous service provider was problematic. Its contract with the provider ended on 18 August 2024.
He said the UIF had sought the services of a new contractor rather than renewing its contract with the previous provider.
“The former service provider is alleging in their court papers, among other things, that without their services, we would not be able to pay South Africans,” Hattingh said.
By mid-September 2024, several sources told MyBroadband that the platform had been inaccessible since at least 23 August 2024, with a notice saying that it was offline for planned maintenance.
“uFiling has been down for months — quite bizarre — everything back to being manual, and payments have to also be manual,” one source said.
“Everything needs to be done by email — a monthly U19, and at the moment, they are auditing small businesses who don’t have the time to ‘go into the nearest labour office to access services.’”
They added that the notice indicating the site was offline for planned maintenance was loading some time after the platform went down.
“In my view, this is an inadequate explanation for a major disruption of a government online service that serves thousands of stakeholders, depending on UIF funding,” they said.
Another source said the outage affected all UIF services, noting that its servers could not be reached and that no explanation was provided.
On 17 October 2024, UIF announced that all its online services had been fully restored and were operational.