WORKERS who are temporarily out of employment may soon start drawing benefits from a fund being set up by the Government.
The National Unemployment Benefit Scheme is designed to protect workers against the impact of job losses.
Government recently tasked the National Social Security Authority (NSSA) to craft a concept paper to assess the feasibility of setting up the scheme.
Currently, Government offers workers two mandatory social security schemes under NSSA: the National Pension Scheme (NPS), which supports retirees above the age of 60; and the Workers Compensation Insurance Fund (WCIF) for workers injured or killed in work-related accidents or suffer from work-related diseases.
The Sunday Mail has gathered that Government, workers and employers will all contribute towards the proposed scheme.
The pooled funds would subsequently be used to provide income for those forced out of work by circumstances.
Under the scheme, beneficiaries will only receive payouts for a specified period while they search for new employment opportunities.
Public Service, Labour and Social Welfare Minister Professor Paul Mavima said experiences with job losses during the Covid-19 pandemic had prompted authorities to consider establishing the scheme.
“The idea is to have a fund that is supported by the workers themselves, employers and Government to support workers who are temporarily out of employment,” said Prof Mavima.
“We want a situation where we invest in building reserves from which unemployed workers can make claims during times of need. Such schemes are common all over the world.
“Our experiences during the Covid-19 pandemic have taught us that we need to be prepared for things like this when people lose their jobs because of unexpected occurrences. People lose their jobs everyday and at times they are between jobs and it is during this time that they need financial support.”
He said legislation to facilitate the roll-out of the scheme will likely be tabled in Parliament during the next session.
“We want to create a savings scheme where we all make contributions so that during tough times people who lose their jobs can find relief. We do not want people to be forced into a situation where they spend the little savings they have made.
“As you know, these things require legislation and this takes a bit of time. But we have already started drafting a blueprint and we expect the legislation to be tabled in Parliament during the next session.”
Responding to questions from The Sunday Mail, NSSA acting general manager Mr Arthur Manase said the scheme seeks to protect workers during times of need.
“I can confirm that the Ministry of Public Service, Labour and Social Welfare requested NSSA to provide input towards a concept note for the establishment of a National Unemployment Benefit Scheme,” said Mr Manase.
“The Authority, in line with its mandate to support Government’s efforts in the provision of social services, responded accordingly and submitted its input towards the concept note.
“NSSA stands ready to assist and when formally requested will subject the concept through its governance system before it is adopted for implementation.”
The objective of the scheme, he added, was similar to unemployment benefit schemes worldwide, which is to protect workers against the impact of job losses and preventing out-of-work poverty.
“They (unemployment benefit schemes) aim to immediately provide income for those forced out of work by circumstances, while at the same time creating incentives for individuals to look for jobs and increase employability since the benefit will be provided over a specified period whilst the worker is looking for employment alternatives.”
Mr Manase said unemployment benefit schemes are one of the nine branches of social security stipulated under ILO Convention 102 of 1952.
He said the convention makes it clear that unemployment benefits are to be paid to an insured person who is not only capable of and available for work, but whose earnings have been suspended due to an inability to obtain sustainable employment.
“Schemes of this nature grant protection in case of full employment loss, partial unemployment and suspension or reduction of earnings due to temporary suspension of work, without any break in the employment relationship for reasons of an economic, technological, structural or any other similar nature,” he said.
The benefit is paid over a period stipulated in the rules of the fund; for example, six to 12 months.
Under the NPS, employers and employees make equal contributions to NSSA and workers are entitled to a set of benefits after making contributions for a minimum set period.
Under the WCIF, employers, except for Government, domestic workers and informal sector employers, contribute to the scheme while employees do not contribute.
In South Africa, one may apply for unemployment benefits following a job loss and failure to secure new employment within 14 days.
One can claim benefits for up to 34 weeks.