Johannesburg - The Minister of Employment and Labour, Thulas Nxesi, has directed his director general to halt a project that would have seen the department approve a funding proposal for Thuja Capital Investment Fund Project, a company that has been reported to be unregistered with Sars and the Companies and Intellectual Property Commission (CIPC).
The project was part of the department’s Unemployment Insurance Fund’s Activation Programme (LAP) and would have seen the UIF invest over R5 billion into this company.
The Congress of South African Trade Union (Cosatu) had accused some officials within the department of entering into a questionable investment deal and ignoring a decision by PIC and UIF’s bid adjudication committee to decline this investment.
In a statement issued on Friday, Cosatu spokesperson Sizwe Pamla said Cosatu was concerned that this deal was being prepared and approved in spite of damning allegations against Thuja Investment Fund.
"Cosatu is alarmed by further allegations of billions of rands being spent on questionable investments by the UIF at a company called Thuja Investments."
Reports have surfaced alleging that the UIF is intending to give R5 billion to a company that is not registered with the Companies and Intellectual Properties Commission nor the South African Revenue Services, has no history of economic activity, let alone experience or expertise in the field of investment," Pamla said.
According to Cosatu, Thuja is owned by a "prominent and politically influential person" who also chairs a public entity that falls under the Department of Employment and Labour. Pamla said it is this conflict of interest that would have made this project a failure and yet another investment scheme gone wrong.
"Cosatu is deeply shocked by the allegations and the general tendency by some in the UIF and the department to play fast and loose with the UIF’s funds. Government should remember the state does not contribute a single cent to the UIF. UIF exists to help employees. We will not tolerate its being used as a slush fund for bogus investments by a politically connected elite with no sense of moral bearing," he said.
Following these allegations by Cosatu and the media, the minister has since put a stop to the proposed investment. The Minister of Employment and Labour notes the media reports on the Thuja Capital Fund Project.
"This is a project under the Labour Activation Programme (LAP), run by the Unemployment Insurance Fund (UIF), together with some partners.
"I have since instructed the Director General (DG) of the Department of Employment and Labour (DEL) and the UIF Commissioner to suspend this project pending a full report on all the matters that are raised about it in media reports and related matters," the minister said in a statement on Sunday.
The Star