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SMMEs check in on ‘racial criteria’

NEWS24 / 12 MAY 2020 - 12.06 / NETTALIE VILJOEN

The application of “racial criteria” to the Tourism Relief Fund has led to heated debates both in the courtroom and in the political landscape.

Solidarity and AfriForum first challenged tourism minister Mmamoloko Kubayi-Ngubane’s decision to provide support to distressed firms and establishments in the sector based on broad-based BEE (B-BBEE) codes in court on Tuesday 28 April. Two days later, the North Gauteng High Court in Pretoria ruled the department’s decision to use race as a criterion is not unlawful.

Tracy-Leigh Gaag, the owner and a chef at Four and Twenty Cafe in Wynberg, says the eatery has had zero income since the national lockdown kicked in.PHOTO: Theresa Smith

AfriForum and Solidarity have since filed urgent papers at the Constitutional Court to set aside the ruling.

The fund provides once-off capped grant (R50 000 per entity) assistance to SMMEs in the tourism value chain.

At the North Gauteng High Court proceedings, the tourism department revealed it had already received more than 10 000 applications for assistance.

According to a City Press report, state lawyer advocate Azhar Bham argued that, with only R200 million available and with a cap of R50 000 per business, only 4 000 businesses could benefit.

People’s Post spoke to three local SMMEs in the tourism industry.

Tjaart van der Walt, owner of Cape Town Bucket List, Seal Snorkeling and Guided Kayaking, says since the start of the lockdown the businesses have had zero income. The enterprise has been operational since 2015 and has 10 employees.

Van der Walt says he applied to the Fund, but has only received an email with a reference number thus far.

“I do think we meet the criteria (we are a level 4 BEE company since our annual turnover is less than R2.5 million) so if we do not qualify our BEE status will be our only downfall,” he says.

Graham Rowe, owner of Harfield Guest Villa, a boutique guest house and B&B, says there is no way he will be able to stay in business without financial assistance.

Rowe says so far he has received a small rates relief from the City of Cape Town, has borrowed a whole lot from the bank, has had to rely on support from family and friends and has managed to only get 75% UIF for one of his six employees for this month.

“We applied for UIF-Covid-19 TERS relief but only received R4 025 for one of my employees. They cannot find my other employees on the system. This is madness as we have been paying an average of R700 plus for UIF per month for almost 25 years.”

Rowe has also applied to the Fund and is waiting on feedback. For him, the criteria makes no sense.

“The employees will be the ones who suffer. We have no chance of making it through without relief. Six more unemployed from a small business in Claremont,” he adds.

Tracy-Leigh Gaag is the owner and a chef at Four and Twenty Cafe – a day-time cafe open seven days a week. The well-known Wynberg eatery has been open for over seven years with 29 employees.

Gaag says she applied for the TERS UIF benefit on 20 April and was paid on 23 April. “I was very impressed,” Gaag says.

She has also applied for the Fund.

Asked whether she felt the criteria to qualify as listed on the government’s website was fair, Gaag said she could only comment on this once she had waited the 30 days (the official application turn-around time) for a response as to whether her application had been approved or denied.

“All information is easily accessible and has not appeared to be unfair. If my application is denied, I would like to understand the reason why. There is a lot of talk and focus on race in the application so if the reason has something to do with race, I would most certainly feel discriminated against.”

Relief measures

  • Guest houses and certain B&Bs can apply (Valuations.RCC@capetown.gov.za) to change their property classification, due to the impact of Covid-19, which could cut rates bills in half in some cases.

  • The hospitality industry can offer accommodation for front-line health care workers or persons who need to be isolated (mushfieqah.salie@westerncape.gov.za).

  • The City’s Business Hub is finalising an agreement with Productivity SA called the Business Support Programme to assist businesses in distress (call 021 417 4043 or email business.support@capetown.gov.za).

  • Visit supportbusiness.co.za for a list of relief funds

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LINK : https://www.news24.com/SouthAfrica/Local/Peoples-Post/smmes-check-in-on-racial-criteria-20200511

Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER

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