We've got news for you.

Register on SowetanLIVE at no cost to receive newsletters, read exclusive articles & more.
Register now

Tourism operators urged to pursue all relief on offer

Sakhumzi Maqubela, owner of Sakhumzi Restaurant on Vilakazi Street, Soweto. / Antonio Muchave
Sakhumzi Maqubela, owner of Sakhumzi Restaurant on Vilakazi Street, Soweto. / Antonio Muchave

In the face of enormous uncertainty brought about by the outbreak of coronavirus, small business owners struggling to stay afloat have expressed mixed feelings about accessing funding from the government.

The government has availed relief to registered tourism employees through the Unemployment Insurance Fund, while operators are hoping to get slice of funding from department of small business development.

The relief is meant to keep both businesses and workers above water during the Covid-19-induced lockdown.

Sakhumzi Maqubela, owner of Sakhumzi Restaurant in Soweto, said he applied for help but it had not yet come through.

"We've applied to the UIF and we are waiting for them to come back about our application. We have also applied for relief from the tourism department. We e-mailed all the required documents. The only response we got was that AfriForum is fighting them, therefore, they cannot release the funds," he said.

Nombeko Rwaxa and Paula Majola, who run accommodation establishments on Vilakazi Street in Soweto, are also waiting for state relief.

"We have applied to the department of tourism and are still waiting for a response.

"They told us that we have to wait for the AfriForum court case," Rwaxa said.

But spokesperson Blessing Manale has since told Sowetan the tourism department has since won the court battle against AfriForum, a rights lobby group who had opposed what they claimed to be planned exclusion of white-owned businesses.

The two entrepreneurs, Majola and Rwaxa, cannot claim from the UIF because they and other association members shared workers, who do laundry and gardening. The association does this to enable the staff to work almost every day. The same personnel who do laundry and garden at Majola's house provide the same services at Rwaxa's home.

While Maqubela and other businesses on Vilakazi Street have struggled to get state help, other establishments in the sector have succeeded.

Mpho Mache, who runs Tshuku Transport & Tours, said he applied for relief from UIF on April 27 and the next day it was paid.

"Our application was acknowledged almost immediately. The process was straight forward. We applied on behalf of our employees, loaded each application manually."

All Mache's eight employees have since been paid. He said the process was easy to follow.

"UIF pays and then gives you a breakdown of how much each employee must be paid from the lump sum they pay to the employer. After the employer pays the employees, the employer must send UIF the proof of payment for all the employees paid," Mache said.

Another employer, Phillemon Makola of Kgokare Tours, said he applied to UIF on April 30 and in less than a week, his employees got paid.

"Employers must ensure they file the electronic UIF file every month so their employees can be found on the department of labour's database."

Last week, President Cyril Ramaphosa said UIF had already paid R11bn to two million workers across SA.

Meanwhile, Manale said tourism department worked with Tourism Business Council of SA and other stakeholders to quantify the extent of the impact of Covid-19, the effectiveness of the help provided and what was still required.

Manale said applications opened on April 7 and would close on May 31. He said many applications were received but without supporting documentation to allow for evaluation.

"The application process is done online, including the mandatory documents which are downloaded into the system. There is an internal pre-screening committee led by a senior manager. The next phase is the evaluation which focuses on the functionality of the business, the pre- and post-pandemic business fundamentals of the enterprise and merit of the grant support.

"This assessment is conducted by a panel of external experts in finance and investment management who volunteered their services. The disbursements of funds is done by South African Tourism."

As at May 10, 13,000 applications had been received.

On the AfriForum case, Manale said: "[The court] found no discrimination on the basis of race and in fact upheld our position on a need for transformation to ensure an inclusive and sustainable tourism sector. Our focus is now to get the much-needed funds to [desperate] SMMEs.

"We have received just over 11,000 applications [5,700 completed and the rest in process].

"The applications represent a fair geographic spread and the diversity of tourism product owners requiring relief.

"We will make the first payments from Tuesday 19 May."

He said the department was fully aware that the R200m Tourism Relief Fund was not enough and urged businesses in the sector to apply for other available relief schemes.

Among these, he said, was the loan guarantee scheme in partnership with the major banks, the National Treasury and the SA Reserve Bank.

"The initial phase of this scheme is for companies with a turnover of less than R300m a year and most of the tourism businesses fall within this category, so we encourage them to utilise this opportunity. This will help them to reduce the burden of operational costs, such as salaries, rent and the payment of suppliers," he said.

"My advice is also for business to look into all the relief measures and packages made available by government and optimally seize their offerings, renegotiate repayments with banks, assist employees to claim from the UIF among others. But importantly, learn, think and plan for the future."

Would you like to comment on this article or view other readers' comments? Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.