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BDLive reports that the Treasury indicated on Wednesday that Finance Minister Nhlanhla Nene is seeking public comment on a proposal to temporarily reduce employer and employee contributions to the Unemployment Insurance Fund (UIF).
While unemployment benefits are to remain unchanged, Nene proposes reducing the earnings ceiling against which the 2% levy is calculated from April 1 2015, something that could release R15bn from the UIF’s financial surplus over the course of a year. The consistently growing R72bn UIF surplus has previously led to calls to reconsider the 2% levy on payroll – which is split evenly between employer and employee. The Treasury said on Wednesday Nene’s proposal would require employers and employees to each pay a maximum of R10 per month as opposed to the current maximum of R149. The Treasury is seeking public comment until 20 March, after which it will consult with the National Economic Development and Labour Council (Nedlac).
Separately, an amendment bill that is before Parliament could entail the extension of the payment period for beneficiaries from eight months to one year, while the income replacement rate would be increased from 38% to 67%.
- Read this report by Karl Gernetzky in full at BDLive
Get other news reports at the SA Labour News home page