UIFBloomberg reports that the Congress of South African Trade Unions (Cosatu) and Business Unity SA (Busa) told the government at a meeting on Monday that it must find ways to utilise the Unemployment Insurance Fund (UIF) to finance temporary layoffs and other methods of supporting companies whose finances have been hit by the coronavirus.  

The UIF has assets of about R180 billion.  SA is already in recession and the state has little fiscal room to bail out struggling industries.  “Much more needs to be done,” said Cosatu’s Matthew Parks.  In addition to the UIF, other state organisations such as the Industrial Development Corporation and the Development Bank of Southern Africa should assist, he proposed.  Parks also suggested that the Public Investment Corporation, which oversees pension investments of state workers, should be tapped. Private banks should consider loan holidays for struggling consumers, he suggested.  The government’s contingency reserve, about R5 billion, could also be used, said Martin Kingston of Busa.  Business representatives argued for the government to re-prioritise its spending away from non-essential state companies with a focus instead on health-care and supporting crucial institutions such as Eskom and Transnet.

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