Labour department creates enormous frustration

IN JUNE 2019 in the State of the Nation Address, President Cyril Ramaphosa declared that the Labour Department will co-ordinate all government efforts to create jobs and reduce unemployment.

- MICHAEL BAGRAIM

Previous to this, the government had been putting pressure on the Department of Labour to look at various ways and means to create jobs.

The major fault running through-out this process has been governments thinking that it must create jobs as opposed to creating an environment conducive for the private sector to create jobs. This history can be tracked from 2010 where the Unemployment Insurance Fund (UIF) introduced active labour market interventions via the training layoff scheme. This scheme was useless for a whole lot of reasons.

In essence, when businesses said that they needed to retrench (dismiss for operational requirements) individuals the department would step in and try and train some of the staff to be qualified to take other jobs. In essence government thought that it could try and second guess the business community so as to somehow believe that these redundant staff members would be suitably qualified to take other positions. This scheme was not only a failure from the start but it wasted enormous money which was effectively taken from the UIF who had invested the money with the Public Investment Corporation (PIC).

This layoff scheme then evolved into the Temporary Employee Relief Scheme (TERS). Once again, this scheme was botched up almost immediately. It became a free for all whereby government employees and some crooked employers were able to fleece further monies from the UIF.