News in South Africa 13th October:

1. UIF running out of money:

In a report released last month, the Auditor-General outlined that Unemployment Insurance Fund’s (UIF’s) Covid-19 Temporary Employer-Employee Relief Scheme (Ters) payments were made to dead people, children, prisoners as well as foreigners who had no made contributions to the fund for 12 months.

This resulted in billions of rands going down the drain. Now news has surfaced that the fund will struggle to fulfil its mandate in future as the Covid-19-induced economic crisis deepens.

Officials, led by Deputy Auditor-General Tsakani Ratsela, told members of Parliament last week Tuesday that the fund is running out of money, due to having to pay out Ters benefits.

UIF running out of money
“Minister Thulas Nxesi briefs media following Auditor-General’s report on UIF COVID-19 TERs benefit, 2 September 2020” by GovernmentZA is licensed under CC BY-ND 2.0

On the flipside, the UIF has recovered R3.2 billion in Ters funds which were paid in error.

Buthelezi said some companies received overpayments worth billions of rands, with an estimated R1 billion paid to individuals who were not supposed to receive the payout.

“In all cases, employers realised that the fund had overpaid them, and returned the money.”

Buthelezi said that investigations are continuing, and some applicants who defrauded the fund have already been arrested.

2. Economic recovery plan leaked:

It appears that President Cyril Ramaphosa’s economic recovery plan, which will be submitted to parliament on Thursday, has been leaked.

 News24 reported that the 48-page draft document, titled the South African Economic Reconstruction and Recovery Plan, outlines eight priority areas to “rebuild and grow the economy” after the economic shock of Covid-19.

Economists and observers who have seen the leaked full plan, describe it as a long list of ‘to-do’ projects, that lack any solid or clear strategy on how to turn the economy around. It recommends extended projects in sectors hit by Covid-19, but lacks direction on needed reforms, and is light on information regarding how these plans will be funded.

3. Land expropriation clarification:

Addressing concerns over land expropriation without compensation, member of the president’s Land Reform Advisory Panel, Bulelwa Mabasa, has sought to clarify some contentious points.

She said that the coming changes are not the ‘nationalisation of land’, and the opposite of the direction Zimbabwe took with land grabs. The state has to provide good reasons for expropriating land, and owners have the opportunity to object. She also said that zero compensation will be under exceptional circumstances.

“It is a recognition of the urgency required to address the injustices of the past and restore land rights in a responsible manner, whilst ensuring that food security is maintained; that equitable spatial justice is achieved, and that continuation of investment to expand our industrial base is secured,” said Deputy President David Mabuza.

The Bill provides certainty because it clearly outlines how and when land may be expropriated, says the government.

The wording of the Bill makes productive land safe from expropriation.

4. Shopping centre exclusivity:

Grocery retailer Shoprite Checkers will no longer be able to enforce exclusivity clauses on lease agreements against small and independent retailers.

This follows the Competition Tribunal’s decision to confirm a consent agreement between the Competition Commission and Shoprite Checkers on the grocery retailer stopping its enforcement of the exclusive lease agreement clauses. The agreement with the commission will also include the retailers OK Foods and Usave businesses.

Last year the commission released its Grocery Retail Market Inquiry Report, following a 12-year investigation on exclusive lease agreements by grocery retailers. The report found that there was no need for the exclusive lease agreements that Shoprite, and South Africa’s other big grocery retailers, Pick n Pay, Spar and Woolworths had with their landlords.

On Monday in a statement, the commission said agreements retailers have in non-urban areas will end immediately and will be phased out of urban areas over the next five years.

5. Steinhoff and Murray & Roberts shares:

Steinhoff’s share price jumped 36% to above R1 yesterday. On Friday, the company said it is making “real progress” in a $1 billion settlement with various litigants.

Construction company Murray & Roberts’ share price jumped 7% yesterday after the group announced that its Australian company was awarded a large contract, as part of a joint venture.

All information sourced from articles posted by: BusinessTech, Business Insider, Moneyweb, Fin24, and 702.

Leave a comment

Your email address will not be published. Required fields are marked *