The Unemployment Insurance Fund (UIF) is embroiled in an R800 million funding scandal after approving a contentious bailout for Siyanda-Bakgatla Platinum Mine (SBM), despite internal reports questioning the mine’s financial distress claims.
The Sunday Times reported that Labour Minister Nomakhosazana Meth has halted the deal, demanding an investigation into the controversial decision.
Dubious Bailout: Jobs Saved or Shareholder Gains?
The UIF had agreed to provide R807 million to save 5,702 jobs at SBM’s Limpopo mine, later revised to R736 million for 5,200 workers. However, leaked documents reveal the fund’s own analysts flagged that SBM was not in financial trouble.
“Acting in the best interest of workers, and as the custodian of the workers’ funds, due to the serious nature of these allegations, Minister Meth is committed to ensuring accountability and that good governance is upheld at all material times,” said her spokesperson, Thobeka Magcai.
Why Was the Deal Approved?
The Sunday Times understands that Siyanda Resources, SBM’s majority shareholder, is in talks to buy Anglo American’s platinum arm, Amplats, raising suspicions that the bailout was politically motivated. Two insiders confirmed the negotiations influenced the UIF’s approval.
Whistleblowers Expose Financial Health Concerns
Internal UIF memos reveal:
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SBM paid R2.7 billion in dividends since 2021.
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Its *debt-to-equity ratio was a healthy 1:6* (February 2023).
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Only in *2024* did the mine record its first loss—yet profits had surged 50% the previous year.
“Based on the February 2023 audited AFS, the current ratio of SBM is calculated to be 3:07, which is three times more than the norm,” a UIF document stated. “This indicates that SBM is not experiencing liquidity issues.”
Ters Scheme Under Scrutiny
The bailout was processed through the Temporary Employee Relief Scheme (Ters)—a Covid-era job-saving initiative now managed by the CCMA. Critics argue the UIF’s eight-month review of SBM’s application ignored red flags.
SBM insists the halted payments, after an R60 million first instalment, jeopardiSe its operations. But with Anglo American’s platinum spin-off, Valtera Platinum, looming, questions remain: Was this a rescue plan, or a backdoor deal for shareholders?
