In following a number of topics related to the Tourism industry, and being a member of the industry as a recently qualified Tourist Guide whose income has ground to a halt, the Tourism Relief Fund offered to the Tourism and Hospitality industry as financial relief during the COVID-19 pandemic is of special interest to me. Earlier this week the Department of Tourism was sent court papers by civil rights organisation AfriForum, for its alleged discrimination based on race in its funding criteria. Industry talk also is that the Fund benefits larger formal tourist companies, and does not provide relief for hundreds of informal freelance operators such as Tourist Guides, the unofficial face of South Africa, in showing international travelers the highlights of our country.
One of the sources of relief funds for tourist and hospitality businesses affected by the Corona Virus Lockdown, the Tourism Relief Fund, has R200 million to offer in packages capped at R50000 each. Simple mathematics shows that only 4000 tourist-related businesses stand a chance to benefit from this Fund, a joke given that Tourism (which includes the restaurant industry and accommodation establishments too) is one of the most prevalent industries in an area such as Cape Town and the Western Cape.
TimesLive reported yesterday that AfriForum claims ‘the tourism department intends to apply “empowerment criteria” when considering pleas for a bailout, and it would be an exercise in aid of transformation. But AfriForum CEO Kallie Kriel called the race criteria shameful and unlawful, insisting that the discrimination did nothing towards funding those who need it most. “The tourism minister’s stated intention to help only some people and not others, because of the colour of their skin, their age or their gender, makes a mockery of SA’s constitutional democracy,” he said in an affidavit’. ‘Discrimination on the basis of race and other unalterable characteristics is immoral and inexcusable. It is unacceptable that President Cyril Ramaphosa could call for national unity … only for the tourism minister to insist that race and other immutable characteristics would be used as the basis for determining which South Africans would receive government support,” he wrote.’
AfriForum further claims that the Fund aims to support tourism businesses, rather than individuals employed in the industry.
In her response to the news reports about AfriForum’s proposed legal action, Tourism Minister Mmamoloko Kubayi-Ngubane denied that court papers have been filed, calling the news ‘fake’, and ‘slammed AfriForum’s claims and insisted that its court challenge was a publicity stunt’. ‘She defended the transformation agenda of the relief fund, saying it was guided by the tourism broad-based black economic empowerment codes of good practice.“Our vision is to ensure sustainable and inclusive tourism development,” she said.’, reported TimesLive.
The Department of Tourism website provides the following information about the Tourism Relief Fund, and its criteria:
’The Tourism Relief Fund provides once-off capped grant assistance to Small Micro and Medium Sized Enterprises (SMMEs) in the tourism value chain to ensure their sustainability during and post the implementation of government measures to curb the spread of Covid-19 in South Africa.
- Accommodation establishments: Hotels, Lodges, Bed and Breakfast (B&B’s), Guest Houses and Backpackers.
- Hospitality and related services: Restaurants (not attached to hotels); Conference venues (not attached to hotels); Professional catering; and Attractions
- Travel and related services: Tour operators; Travel agents; Tourist guiding; Car rental companies; and Coach Operators.
The application window for the Tourism Relief Fund will close on 31 May 2020’.
On the AfriForum website its media statement announcing the court action against the Department of Tourism, dated 14 April 2020, states the following:’
AfriForum today served court papers for an application for review to force the Minister and the Department of Tourism to ensure that the race of applicants must play no part in the support which the Department’s COVID-19 Tourism Relief Fund renders to small, micro- and medium-sized enterprises (SMME’s). This Department currently indicates that black economic empowerment (BEE) and economic transformation will be used as criterion for support.
This follows after AfriForum on 7 April 2020 placed Mmamoloko Kubayi-Ngubane, the Minister of Tourism, as well as the Department on terms regarding BEE and other requirements. According to Kallie Kriel, CEO of AfriForum, not the Minister or the Department reacted to AfriForum’s letter and as such AfriForum now has no other choice but to approach the courts.
In the court papers, AfriForum requests that the application be handled on an urgent basis and already be heard on 21 April 2020 seeing as the Department will now already decide on a weekly basis which tourism enterprises will be helped. This fund currently contains R200 million. AfriForum also included various case studies with the court papers of business enterprises that are being disadvantaged by these arbitrary requirements.
According to Kriel, it is disgraceful that the government has decided to misuse assistance to struggling enterprises to promote a race-based agenda even in a time where everyone in the country needs to stand together against the mutual enemy – COVID-19. Kriel pointed to the fact that the Department’s racial requirements amount to unfair discrimination and is therefore unconstitutional. “The expressed aim of the Department’s fund is to offer assistance to tourism enterprises that are being adversely affected by COVID-19. Seeing as everyone, notwithstanding their race, is being adversely affected by COVID-19, the Department cannot use Section 9(2) of the Constitution, which justifies correction of discrimination from the past, as justification for discriminating assistance against the consequences of COVID-19.”
AfriForum encourages all tourism enterprises to still apply for relief at www.tourism.gov.za/Pages/COVID19TOURISMRELIEFFUND.aspx. You can SMS the name of your enterprise to 45113 (R1) to provide AfriForum with your enterprise’s details so that we can implement legal action on your behalf should your application be rejected based on BEE requirements. You can also send an email with your enterprise’s details to afriforum@afriforum.co.za.’
The Department of Tourism’s official response was published yesterday by the government news agency:
’Tourism Relief Fund does not discriminate: Kubayi-Ngubane
Any person or small business in the tourism sector, regardless of their skin colour, can apply for financial relief from the Tourism Relief Fund, says Tourism Minister Mmamoloko Kubayi-Ngubane.
The Minister reiterated this following reports that interest group, Afriforum, has served the department with court papers calling for the review of the Tourism Relief Fund.
In a statement issued on Wednesday, the Tourism Minister said it has been inundated by inquiries from the public on the matter.
“We therefore would like to put it categorically clear to the public that no such court papers were filed with the court by Afriforum to date. Therefore, any statement issued to the contrary is disingenuous,” read the statement.
The Ministry said it received papers from attorneys of Afriforum purporting to be an Urgent Court Interdict to the Relief Fund and further indicating that we should respond by 9am.
“Our position is that those papers, which were emailed to us, did not have a court case number, meaning there is no court process, which was initiated, and we are not able to respond to court,” said the Ministry.
The Tourism Relief Fund, which AfriForum is vehemently opposing, provides once-off capped grant assistance to Small Micro and Medium Sized Enterprises (SMMEs) in the tourism value chain to ensure their sustainability during and post the implementation of government measures to curb the spread of COVID-19 in South Africa.
Capped at R50 000 per entity, grant funding can be utilised to subsidise expenses towards fixed costs, operational costs, supplies and other pressure cost items.
The fund is guided by the Tourism Broad Based Black Economic Empowerment (B-BBEE) Codes of Good Practice approved by the Minister of Trade and Industries in 2015, and administered in line with the objectives of Economic Transformation, and its vision to ensure sustainable and inclusive tourism development.
The Ministry said the Department of Tourism is acting in accordance with Section 10 of the B-BBEE Act which makes the application of BBBEE codes of good practice mandatory as it states that: “[e]very organ of state … must apply any relevant code of good practice issued in terms of this Act in … determining criteria for the awarding of incentives, grants and investment schemes in support of broad-based black economic empowerment.”
The Ministry said government is aware of the difficulties experienced by businesses during the COVID-19 lockdown and acknowledged the need to support the industry and communities to cope with the negative effects of this pandemic.
“Any person or business in the tourism sector can apply for the fund, regardless of the colour of their skin. Applicants are required to be fully compliant as required by law. More information on the fund are available on the department’s website www.tourism.gov.za,” said the Ministry. – SAnews.gov.za
Chris von Ulmenstein, WhaleTales Blog: www.chrisvonulmenstein.com/blog Tel +27 082 55 11 323 Twitter:@Ulmenstein Facebook: Chris von Ulmenstein Instagram: @Chrissy_Ulmenstein