The Department of Employment and Labour, together with Trade, Industry and Competition (DTIC), through the Unemployment Insurance Fund (UIF) and the National Empowerment Fund (NEF), have launched a R1 billion fund to provide seed capital and financial support to black-owned and black-managed businesses.
Launched by Employment and Labour Minister Nomakhosazana Meth in Johannesburg on Friday, the UIF-NEF partnership will expand access to finance for qualifying businesses while providing support aimed at promoting enterprise sustainability, creation and retention of jobs.
The UIF and NEF will each contribute R500 million to the fund.
Speaking at the launch, Meth said the department is investing in the people who build businesses, take risks, serve customers and create work in the communities.
“We are also recognising a central lesson of South Africa's development strategy: if we want employment at scale, we must enable small businesses to start, survive and grow," Meth said.
She said creating employment at scale requires greater support for small businesses to start, survive and grow.
Meth said the strength of the partnership lay in bringing together the respective capabilities of the UIF and NEF.
“The UIF brings its employment and labour activation mandate. The NEF brings its enterprise finance and development capability. By joining those strengths, they can support businesses with the potential to grow and employ more people,” she said.
The UIF provides short-term financial relief to workers who become unemployed or are unable to work because of maternity, adoption, parental leave or illness, as well as relief to the dependants of deceased contributors.
The NEF promotes Black economic participation by providing financial and non-financial support to Black-owned and managed businesses.
The partnership will combine public resources with the NEF’s development-finance expertise to support qualifying enterprises with growth potential.
It is also aligned with the UIF’s broader Labour Activation Programme (LAP) framework, which focuses on interventions and partnerships that promote employment creation, skills development, entrepreneurship and economic participation.
Meth said the department is repositioning the LAP around three interconnected pillars, including skills development based on real demand; workplace experience and placements; and enterprise support to enable Micro, Small, and Medium Enterprises (MSMEs) to create jobs.
“The programme is intended to recruit 200 000 unemployed people in 2026/27, as part of a commitment to reach 605 000 beneficiaries over the medium term,” she said.
LAP comprises interventions aimed at integrating or re-integrating unemployed people into the labour market. These include training for the unemployed, enterprise development, training layoff schemes and turnaround solutions.
The programme seeks to improve employability, promote entrepreneurship and help preserve jobs.
Launching the fund under the theme: “Investing in Enterprises. Advancing Employment. Driving Transformation”, Meth said its success will ultimately be measured by the businesses and jobs it helps create.
“The real test begins now: when an enterprise secures support, wins customers, expands production, and employs more South Africans. We must follow that journey and measure the result,” the Minister said.
Meth stressed that the economy needs faster growth, while established firms need to invest and expand, and more MSMEs need to become sustainable employers.
“More people need a practical route into the skills, experience and opportunities that a growing economy requires.”
DTIC Deputy Minister Zuko Godlimpi said the launch demonstrates the value of practical partnerships between government institutions in addressing unemployment and supporting enterprise development.
He said the unemployment rate, currently at 33.6%, requires greater coordination between institutions responsible for job creation, enterprise development, and infrastructure development.
Godlimpi said the joint fund will also help bridge the gap between enterprise development and skills training, by combining financial support with mentorship and technical assistance.
“The two institutions will be pulling together resources and capabilities. The UIF brings its job creation capability and NEF bring its enterprise development capability".
Godlimpi added that the success of the fund will not only be measured by the financial performance of supported businesses but also build sustainable enterprises capable of growing and creating lasting employment.
“We want to see growth of enterprises that pull many people out of unemployment,” he said. SAnews.gov.za
