The South African Federation of Trade Unions (SAFTU) is deeply concerned by revelations that the Public Investment Corporation (PIC) Isibaya Fund invested approximately R4.45 billion in 15 companies and projects that have now recorded an Internal Rate of Return (IRR) of -100%, meaning that every cent invested has effectively been lost.
These investments include companies such as Independent Media, Educor, Concor, Urban Lifestyle, VIA Bounty, Bayport, and several others whose combined value has been written down to zero. According to information provided to Parliament, the PIC received no proceeds from these investments, and their current market value is nil.
These are not merely numbers on a balance sheet. These funds belong largely to workers. They represent the deferred wages and retirement savings of public servants through the Government Employees Pension Fund (GEPF), as well as monies entrusted to the PIC byinstitutions such as the Unemployment Insurance Fund (UIF) and the Compensation Fund.
For SAFTU, the central issue is accountability. Workers have every right to know how R4.45 billion of their money could be invested in ventures that ultimately produced no financial return whatsoever.
Workers Bear the Risks While Capital Captures the Rewards
The latest revelations expose a deeper contradiction within South Africa’s political economy. When workers demand higher wages, improved pensions, increased public spending, or better social services, they are routinely told that there is no money. Treasury insists on fiscal consolidation. Public sector vacancies remain frozen. Hospitals remain understaffed. Schools suffer shortages. Municipal infrastructure collapses under austerity. Yet billions of rands can apparently be channelled into risky investment schemes that ultimately evaporate without meaningful consequences for those responsible.
This reflects a broader pattern in which workers are expected to shoulder the risks while politically connected elites and private interests often capture the rewards.
The question that must be asked is whether some of these investments genuinely served developmentalobjectives or whether they primarily benefited a narrow layer of politically connected individuals while exposing workers’ savings to unacceptable levels of risk.
The PIC Losses Are Not an Isolated Incident
SAFTU is deeply concerned that the losses associated with the PIC’s Isibaya Fund are not an isolated occurrence but rather part of a disturbing pattern that has become characteristic of several public institutions entrusted with workers’ money. The experience of the Unemployment Insurance Fund’s Labour Activation Programme (LAP) provides a stark warning.
The LAP was established to utilise UIF resources to providetraining, skills development, enterprise support, and employment opportunities for unemployed workers. It was intended to equip the unemployed with skills, facilitate labour market reintegration, and contribute to job creation.
However, over the years, numerous investigations by the Auditor-General, parliamentary committees, the Public Protector, and the Special Investigating Unit exposed serious governance failures, irregular expenditure, inadequate monitoring of service providers, poor verification of beneficiaries, procurement irregularities, and allegations of fraud and corruption involving funds intended to assist the unemployed.
Millions of rands allocated to combating unemployment failed to produce the promised
developmental outcomes. In some instances, service providers were paid despite failing to deliver training. In others, beneficiaries could not be properly verified. Programmes were plagued by weak oversight and poor accountability while millions of unemployed SouthAfricans remained desperate for opportunities.
The similarities between the failures within the LAP and the losses suffered through certain PIC investments are deeply troubling. In both instances, public institutions invoke developmental objectives to justify investment decisions and expenditure. Yet developmentalobjectives cannot become a substitute for accountability.
Workers have every right to ask whether these programmes genuinely served their intendedbeneficiaries or whether they became vehicles through which politically connected individuals and private interests enriched themselves while workers carried the losses.
The repeated failure of developmental funds and programmes damages public confidence in the very idea of developmental investment. This is particularly dangerous because South Africa desperately needs public investment to drive industrialisation, infrastructure development , skills formation, and job creation.
The answer, therefore, is not to abandon developmental investment. Rather, it is to ensure that every rand invested is subjected to rigorous due diligence, transparent reporting, democratic oversight, and strict accountability mechanisms.
Workers’ Money Should Save Jobs, Not Finance Failed Capitalist Speculation
The PIC losses also raise a fundamental question about the purpose for which workers’ savings are being utilised.
In September 2025, SAFTU’s Extended Campaigns Committee considered the deepening crisis of deindustrialisation sweeping across South Africa. The meeting took place against the backdrop of factory closures, retrenchments, and industrial decline that continue to devastate working-class communities across the country. Amongst the major resolutions adopted wasthe call for workers to occupy and take over factories and enterprises that are being closed or abandoned by capital.
This resolution was informed by the closure of major productive facilities and the destruction of thousands of jobs. Companies such as Goodyear South Africa announced the closure of their tyre manufacturing operations. British American Tobacco undertook a restructuring that threatened jobs. ArcelorMittal South Africa announced plans affecting thousands of workersand the industrial value chain. Tongaat Hullett’s ongoing crisis placed further jobs, livelihoods, and productive capacity at risk.
These developments reveal a fundamental contradiction within South African capitalism. On the one hand, workers’ pension savings, UIF contributions, and public resources are mobilised to finance private investment schemes under the banner of “development”. On the other hand, productive industries are allowed to close, workers are retrenched, factories stand idle, and entire communities are plunged into poverty.
SAFTU argues that the billions of rands lost through failed PIC investments and poorly administered programmes such as the UIF Labour Activation Programme should instead be directed toward preserving productive capacity, protecting jobs, and expanding worker ownership.
If public institutions can invest billions into speculative ventures, politically connected businesses, and developmental projects that ultimately collapse, why can those same resources not be used to recapitalise factories threatened with closure? Why can they not be deployed to assist workers in taking over enterprises abandoned by capital? Why should workers’ money beused to subsidise private accumulation while workers themselves are denied ownership and control over the means of production?
The closure of factories is frequently presented as an unavoidable consequence of market forces. SAFTU rejects this logic. Factories close not because society no longer requires the goods they produce, but because they no longer generate sufficient profits for their owners. Workers, communities, and the national economy are expected to bear the social costs ofdecisions made in pursuit of private profit. A genuine developmental investment strategy would prioritise productive employment over financial returns for elites. It would utilise workers’ savings to sustain industries, preserve jobs, expand manufacturing capacity, and build democratic forms of worker ownership.
Rather than financing dubious capitalist ventures that enrich a few and collapse shortly
thereafter, public investment institutions should be supporting worker cooperatives, worker buyouts, and worker-controlled enterprises capable of sustaining employment and contributing to industrial development.
The repeated losses suffered by the PIC and the failures exposed within the Labour
Activation Programme demonstrates that the existing model is failing workers. Public
resources continue to be directed toward private projects whose social and economic benefits are often questionable, while workers facing retrenchment are left with little more than promises of retraining and unemployment benefits.
SAFTU therefore reiterates its position that workers must not simply be passive victims of deindustrialisation. Where employers seek to close viable operations and destroy jobs, workers should have the right to occupy, take over, and democratically manage thoseenterprises, supported by public finance institutions whose resources derive largely from workers themselves.
Workers’ money should be used to save jobs, sustain production, and expand democratic ownership, not to finance failed capitalist speculation and enrich politically connected elites at the expense of the very workers whose savings made those investments possible.
A Crisis of Governance and Accountability
The losses associated with the Isibaya Fund cannot be separated from the broader governance crisis that has plagued portions of the PIC’s unlisted investment portfolio.
Over the years, concerns have repeatedly been raised regarding politically influenced
investment decisions, weak oversight, inadequate due diligence, poor post-investment
monitoring and insufficient accountability when investments fail.
The recent suspension of the Acting Head of Unlisted Investments raises further concerns regarding governance within the institution. While the PIC insists that investment processes continue uninterrupted, workers deserve more than assurances. Confidence can only be restored through transparency and accountability.
The PIC losses and the failures of the Labour Activation Programme demonstrate that
developmental finance without accountability becomes fertile ground for waste, corruption, patronage, and elite accumulation. Workers cannot continue to be told that there is no money for wage increases, public services, job creation, and social protection while billions of randsentrusted to public institutions disappear through failed investments and poorly governed programmes.
SAFTU’s Demands
SAFTU calls for a comprehensive public accounting of all failed Isibaya investments and demands that Parliament exercise rigorous oversight over the management of workers’ pension funds.
We further demand:
- A full forensic investigation into all investments that resulted in total losses.
- The publication of all due diligence reports related to failed investments.
- The identification and prosecution of any individuals responsible for negligence, misconduct, corruption,or breaches of fiduciary duty.
- Greater worker representation and democratic oversight in institutions responsible for managing workers’ deferred wages.
- A comprehensive review of developmental investment criteria to ensure that measurable social and economic outcomes accompany developmental
- objectives.
- A full review of the UIF Labour Activation Programme and all related contracts awardedunder the programme.
- The recovery of any public funds lost through fraud, corruption, or gross negligence.
- The establishment of a dedicated worker-controlled industrial recapitalisation fund to support worker buyouts, worker cooperatives, and factories threatened with closure.
- Stronger governance mechanisms across all public developmental funds and state investment vehicles.
Development Must Serve Workers, Not Elites
SAFTU remains committed to the principle that public finance and workers’ savings should be utilised to support industrialisation, infrastructure development, job creation, and economic transformation. However, developmental finance must not become a vehicle for enriching politically connected individuals while socialising losses onto workers.
Workers cannot be expected to accept austerity, wage restraint, rising unemployment, and deteriorating public services. At the same time, billions of rands of their pension savings and UIF contributions disappear into failed investments and poorly governed programmes.
The PIC must remember that it is not managing abstract financial assets. It manages the lifetime savings of millions of workers who depend on those funds for their retirement security and future dignity.
The time has come to fundamentally rethink developmental finance in South Africa. Instead of subsidising private accumulation and repeatedly rescuing failed capitalist ventures, workers’ savings should be mobilised to preserve jobs, sustain productive industries, support worker ownership, and advance democratic worker control over the economy.
A statement was issued on behalf of SAFTU by the General Secretary, Zwelinzima Vavi.
For media inquiries, contact the National Spokesperson at
Newton Masuku
Newton@saftu.org.za
0661682157
Media Officer
Asive Dyani
0719019564
