Relief fund for tourism industry

Businesses in the hospitality industry were hard hit by the Covid-19 pandemic and the lockdown to curb its spread.

As the country moves to Level 4 of the lockdown from tomorrow, the doors of a number of businesses will open for the first time in five weeks.

This comes after President Cyril Ramaphosa announced that the country would begin a gradual and phased recovery of economic activity beyond today.

Funds have been made available to help businesses deal with the impact of the Covid-19 pandemic on the country.

Among these, is the tourism relief fund by the Department of Tourism, which aims to help accommodation establishments such as hotels, B&Bs, guest houses and backpackers that have been negatively affected by Covid-19. Restaurants and conference facilities not attached to hotels, professional catering businesses, travel agents and car rental companies are among the businesses eligible to apply for the fund.

However, there are criteria that businesses need to meet to get the relief funds. The criteria includes that businesses must:

Have proof of valid registration with Companies and Intellectual Property Commission (CIPC).

Be an Exempted Micro Enterprise (EME) defined in terms of the Amended Tourism B-BBEE Sector Code, 2015.

Have a valid tax clearance certificate or PIN.

Have proof of compliance with the minimum wage requirements.

Provide proof of UIF registration for employees employed by the business.

Be an existing tourism-specific establishment as outlined in the scope of application (suppliers and intermediaries are not eligible).

Guest house owner in Sea Point, Raymond McGovern, said he has been severely affected by Covid-19 and may have to shut down his business.

“Unfortunately we don’t meet the criteria, we are not black or disabled and therefore we’re not getting anything from the government or the City of Cape Town.

“Our guest house has been empty since March 24 and every day we get calls from people cancelling and I don’t know how I’m going to pay our bills,” he said.

Sharing these sentiments, B&B owner in Bo-Kaap, Bruce Steirs, said even though he hired black employees, his business still doesn’t meet the criteria for the relief fund.

Mr Steirs said the business struggled with the water crisis that faced Cape Town two years ago and the Covid-19 crisis will finish it off. “I spent so much money refunding clients, I cancelled some of my insurance to be able to pay my staff. We have no bookings and I have come to terms that my business will go bankrupt,” he said.

In efforts to help businesses that do not meet the criteria, James Vos, the City’s mayoral committee member for economic opportunities and asset management, said he’s written to the Minister of Tourism, Mmamoloko Kubayi-Ngubane, to seek clarity and argue for these criteria to be broadened.

He said the criteria used to determine who qualifies effectively excluded a large number of businesses based on race. “The fact is that all businesses should qualify for relief funding. Exclusionary and onerous criteria should not apply in a state of disaster. This will only serve to divide us when we need to pull together to get through this crisis,” he said.

Mr Vos said the City’s executive mayor, Dan Plato, has now written to Ms Kubayi-Ngubane to request a meeting to negotiate and put forward their request that all SMMEs be allowed to qualify for relief, no matter their race. “We remain hopeful that the minister will take into account the plight of all businesses and their employees who are being negatively affected by this crisis, and that no discrimination be applied. An intergovernmental dispute will be our last recourse. However, we will not hesitate to pursue this option in these unprecedented times when millions of jobs and businesses are on the line,” he said.