Here in the hallowed corridors is hon Eric Mtshali, popularly known as Stalin, who also served with great integrity, especially with Sactu, and continues to inspire and lead. It is stalwarts such as these that showed ... [Applause.] ... extraordinary courage and determination, thus contributing to the improvement of the working conditions and the formation of strong trade unions for South Africa's workers.
House Chair, the democratic state post 1994 sought to translate these wishes of thousands that gathered in Kliptown into a reality. Bringing change to a system as pervasive and systemic as state-sanctioned discrimination is not an event but a process.
We continue, therefore, to fine-tune the process and evolve our jurisprudence to keep up with changing conditions. We reported to this Chamber last year that we had instituted wide-ranging legislative reforms. These reforms include the very effort of curbing the abusive practices visited on workers every day by the system of labour broking. The fact that both business and labour are up in arms with regard to some of the proposed changes tells us that we are doing something right.
We promised to continue protecting vulnerable workers, as enjoined in the Freedom Charter, where it says miners, domestic workers, farmworkers and public servants shall have the same rights as all other workers.
One of the most effective tools the department employs in protecting the vulnerable sectors of our society are sectoral determinations, which regulate the minimum wage that workers can earn in a given industry. Let me repeat, sectoral determinations regulate the bare minimum wage. To this end, in the past financial year, the department has amended and reviewed the determinations in the hospitality, contract cleaning, civil engineering, private security; taxi, wholesale and retail and farmworkers sectors.
We are proposing the following changes to the Unemployment Insurance Act. Firstly, increasing a beneficiary's benefits period from eight months to 12 months, which means workers will be paid over a longer period without additional contributions. [Applause.] The inclusion of domestic workers on maternity benefits; in addition, a woman who goes on maternity leave will be paid at an income replacement rate from 38% to 66%. [Applause.]
Secondly, workers will be given adequate time to claim UIF up from six months to 18 months for death benefits and 12 months for other benefits. Thirdly, this is an attestation, ladies and gentlemen, to the prudent and correct management of the funds by the Unemployment Insurance Fund, which has made it possible for the state of affairs where we add to the benefits possible.
After all, bringing those in need under the protective blanket is a function and purpose of developing our young state, as Amartya Sen, in his seminal book Development as Freedom asserts:
Protective security is needed to provide a social safety net for preventing the affected population from being reduced to abject misery and in some cases even starvation and death. The domain of protective security includes fixed institutional arrangements such as unemployment benefits and statutory income supplements to the indigent as well as ad hoc arrangements such as famine relief or emergency public employment to generate income for destitutes.
The proposed changes to the Compensation for Occupational Injuries and Diseases Act, Coida, will see domestic workers and farmworkers covered by these protective measures. We continue fighting the scourge of child labour, compound labour, the tot system and contract labour, as stated in the Freedom Charter.
In June, we will be hosting Child Labour Day in Mpumalanga after successfully doing so in Limpopo last year. We are all aware that children are made to do work not suitable for their age, especially in the agricultural sector. Alongside our sister departments, we realise the shortage of skills in our economy and are working to make a difference in this field.
To this end, we have partnered with the SA Maritime Safety Association to enable them to tap into our system for the cadets they want to put through the paces of training. We have also agreed to work with the Department of Higher Education and Training to have these cadets placed at FET colleges. As you will hear later, we have also partnered with Setas to provide training for youth and unemployed people.
I would also like to take this opportunity to congratulate the 2013 class of the Workers College Natal who were awarded diplomas by the University of KwaZulu-Natal in fields like labour studies and labour economics. This college, which is partly funded by the Department of Labour, provides capacity-building for union officials of these federations' affiliates to obtain a national academic qualification.
It may very well be that we would be approaching the fiscus in the next Medium-Term Budgetary Framework to explore whether this noble concept could be replicated to other provinces.
But we also continue lending weight to other efforts to build capacity through our support of Ditsela, which is involved in building capacity by training union officials. The funding for this has been in place since 1996. For the next three years, R30,4 million has been allocated for this purpose.
Colleagues and compatriots, as you know full well, the Department of Labour is comprised of critical branches. Allow me to give an update on the different entities: The Unemployment Insurance Fund, UIF, continues to play a pivotal role in the area of job creation, ably guided by its board. During the 2012-13 financial year, the UIF and Industrial Development Corporation, IDC, continued their collaboration through the issuance of an additional bond of R2 billion, which has increased the total bond to R4 billion. The IDC utilises these funds to lend out to businesses that aim to create or save jobs. Through this partnership, 21 234 new jobs were created and 20 161 saved for the period up to 31 March 2013.
For the 2013-14 financial year, this investment has increased from 5% to 10% of the total investment portfolio. That means over R8 billion will be made available for investment in manufacturing, mining beneficiation, agriculture and tourism. We have allocated R3,2 billion to the Public Investment Corporation, PIC, to plough into job creation projects, over and above the amount allocated to the Industrial Development Corporation.
In addition, the UIF will continue funding Productivity South Africa's Turnaround Solutions. A three-year R39 million per year agreement to assist companies in distress to save jobs and keep people in employment.
The department will also continue with reskilling beneficiaries who lost their jobs for reintegration into the labour market through its training of the unemployed initiative in collaboration with various government training institutions.
Chairperson, let me say that last year, we trained 1 000 UIF beneficiaries and unemployed youth on various ICT related programmes in collaboration with the Media Information and Communication Technologies, Mict, Seta, 1 000 on mining-related artisan programmes, and 1 500 in various artisan trades in collaboration with the Manufacturing, Engineering and Related Services Sector Education and Training Authority, Merseta. [Applause.]
The UIF has maintained its commitment of R1,2 billion made towards the funding of the Training Lay-off Scheme. A total of R105 million has been budgeted for the 2013-14 financial year.
In all this the UIF has remained true to its core mandate of collecting contributions from employers and paying benefits. During the 2012-13 financial year, the collection of revenue increased by 9,8%.
Regarding the inspection and enforcement services, in the last financial year, we lost one of our members, the deputy director-general, Siyanda Zondeki. And may her soul rest in peace.
In terms of the work of this branch, during the past year, the department adopted a more targeted approach to inspection and enforcement. It did so by adopting a targeted approach to deal with the most problematic sectors as well as the high-risk sectors where levels of noncompliance and injuries on duty are more pronounced, as evidenced by our claim history at the Compensation Fund.
In the 2012-13 financial year, we have conducted 141 744 inspections in these sectors alone. Of these, 112 672 were in what we term the problematic sectors and 28 803 in high-risk sectors.
Sometimes we were disturbed by some of the companies that were not complying with the laws of this country. Given this level of compliance, it is necessary for me to remind our social partners that they share the responsibility for ensuring that employers and employees comply with the labour laws of this country. We have jointly formulated our legal framework through social dialogue, and we need to work together to ensure an improved level of compliance in our labour market.
The Employment Equity Team for the year under review has completed 269 director-general's reviews in terms of the Employment Equity Act. The overwhelming majority of companies reviewed, 254 to be exact, were found to be noncompliant. We will vigorously pursue compliance going forward.
At a policy level we have completed the work in preparation for our ratification of the International Labour Organisation's, Convention 81 on labour inspection. It is our aim to register our ratification of Convention 81 at the ILO during the course of this year.
We will also seek to amend the Occupational Health and Safety Act to ensure that it does not only respond to the needs of a changing economy but also strengthen powers of our occupational health and safety inspectors.
With regard to Public Employment Services, in June 2012, the department officially launched the jobs fair and summits that were conducted in all the nine provinces.
The immediate effect of the jobs fair was as follows: 23 726 work seekers were registered; 14 253 work seekers received employment counselling to assist them in career choices; 8 051 job opportunities were registered by employers, accompanied by pledges of real and immediate job opportunities from employers. The jobs fair was an important start in the processing of awareness of the Public Employment Services.
It is a pleasure to welcome to the House today a number of employers who participated in our jobs fair and have made use of the department's employment services. With them are young, first-time entrants to the labour market who have been placed in jobs through our services. They are there in the gallery.
During the last financial year, our employment services managed to register a total of 600 259 work seekers and the service managed career counselling to 26 468 work seekers whilst 16 171 were placed in job opportunities
Last year, I reported that the Sheltered Employment Factories that fall under the department and employ more than 1 000 persons with disabilities had started a turnaround strategy.
The Compensation Fund is responsible for managing the Compensation for Occupational Injuries and Diseases Act, Coida, which deals with compensation for injuries and diseases contracted in the work environment. The fund has experienced challenges in the last financial year. The challenges experienced have been brought to the attention of the portfolio committee. In our last budget we also made a commitment to the implemented turnaround strategy. This has been partly implemented.
Let me say that we indicated last year that the fund will launch an online submission of return of earnings and this system was launched in May 2012. To date close to 200 000 employers switched from manual to an online submission system and the fund was also able to collect over R7,3 billion in revenue as a result.
In the period under review, the Compensation Fund paid out over R775 million in pensions to over 295 000 beneficiaries. We also indicated last year that special attention will be given to improving claims management, and I am glad to say that there have been some improvements on this front, but more still needs to be done. We have managed to process 934 000 invoices in medical payments amounting to R1,5 billion, a remarkable improvement indeed.
I have directed the commissioner and the director-general to initiate a process of piloting the Rand Mutual Assurance, RMA, claim system as a matter of urgency and provide me with regular feedback. We will also be amending the Compensation Fund Act to introduce an enabling provision for rehabilitation and early return to work for the injured and diseased workers. The draft amendment Bill has been signed off by the board and it is going through the internal legal processes.
The fund has funded a total of 21 social civil society job-creation projects and the discussions with the Public Investment Corporation, PIC, to allocate R3,5 billion investible income for job creation and infrastructure development process.
In the area of labour relations, the past year has raised a number of challenges. The department will continue to work with our social partners to stabilise areas where there is conflict in labour relations. I also want to acknowledge the important work that is being carried out by the CCMA in mediating and conciliating disputes and providing other support, including to platinum mining companies. It is crucial that employers and trade unions do whatever they can to stabilise incidents of unrest wherever they occur.
Regarding our obligations to the International Labour Organisation, ILO, South Africa has been in the forefront of ratifying the different conventions. Recently, Parliament has ratified the Maritime Labour Convention of 2006 to provide a modern system of improved conditions of decent work in the maritime sector together with an enforcement regime.
Convention concerning work in the fishing sector of 2007 to ensure that employees on fishing vessels will have decent conditions of work, including food and accommodation, occupational safety and health, medical care and social security.
Labour Inspection Convention, 1947, No 81: To provide useful guidance for designing and monitoring an improved labour inspection system. Domestic Worker Convention, 2011, No 189: To enhance protection of domestic workers worldwide. In any event, nearly all issues in this convention are already entrenched in the sectoral determination for domestic workers. There are, however, a few issues that still need to be addressed, such as the coverage of domestic workers under the Compensation for Occupational Injuries and Diseases Act, Coida.
We have also ratified the Technical Assistance Guidelines on HIV and Aids Code, and we have been reviewed and aligned with the ILO's Recommendation 200, concerning HIV and Aids work, which has also been adopted. I just want to urge this hon House that if you are an employer of a domestic worker, you must register that domestic worker, because if you don't do that you will face the consequences. [Applause.]
The Commission for Employment Equity's latest report shows that there is still a long way to go. Employment equity is not a compliance issue. It is not about ticking boxes. It is a moral and human rights imperative; it is a precondition for the achievement of sustainable development, economic growth and equality in the country, which should be supported by "decent work" initiatives. Proactive measures are required by organisations to develop and harness an inclusive and diverse workforce that is free from unfair discrimination and is reasonably demographically representative.
Earlier in the year we reviewed the sectoral determination of farmworkers. A number of farmers indicated that they could not meet the wage determination of R105 a day. We made it clear that subject to certain conditions, it was possible for temporary exemptions to be granted.
With regard to the Department of Labour's strategic priorities, I will just highlight the others, based on the appropriation; R23,2 million in respect of salary adjustment; R50 million in respect of the Sheltered Employment Factories, and R85 million in respect of the CCMA roll-out.
This spending focus over the medium term will continue to be on protecting vulnerable workers, reintegrating work seekers into the labour market and ensuring the "decent work" agenda. Also in this financial year the department will have an opportunity to manage, for the first time in 10 years, its own IT services; improve the functioning of the Compensation Fund; substantially reduce the claims backlog and turnaround times on claims and employer services.
In relation to the our legislation we will be focusing on amendment of the Unemployment Insurance Act, amendment of the Compensation for Occupational Injuries and Diseases Act, amendment of Occupational Health and Safety Act; as well as amendments to other labour legislation, including the promulgation of Employment Services Bill, which is currently before Parliament.
In this financial year, we are going to upskill 1 000 domestic workers as well as train farmworkers in terms of the Black Economic Empowerment Act, BEEA, Labour Relations Act, LRA, and sectoral determination.
The current year should be one in which the department can focus on promulgation and implementation to improve worker protection and employment security.
Hon House Chair, allow me to finally thank all the members that helped us, particularly advisory boards for different entities. I also want to thank the department officials, led by the director-general, for their support; and I will particularly like to thank the staff in the Ministry, whom I sometimes give a hard time.
I would like to finally commend the budget of Labour to the hon members of this House. Thank you, Chair. [Applause.]