News24 Wire
Wire Service
2 minute read
20 Jan 2021
9:33 pm

Western Cape businesses hard-hit by lockdown regulations

News24 Wire

For the last 10 months, businesses barely survived the lockdown and the constant regulations.

A waitress carries dishes on the terrace of restaurant in Marseille, southeastern France, on October 5, 2020, after the city's restaurants were authorised to re-open following a week-long closure as part of measures aimed at curbing the spread of the Covid-19 (novel coronavirus) pandemic. (Photo by NICOLAS TUCAT / AFP)

The Western Cape’s tourism and hospitality sector is on its knees.

With new Level 3 lockdown regulations in place, many businesses cannot sustain their operations or pay their employees.

For the last 10 months, businesses barely survived the lockdown and the constant regulations.

Western Cape Finance MEC David Maynier has made a desperate plea to Employment and Labour Minister Thulas Nxesi to urgently extend the Unemployment Insurance Fund (UIF) Temporary Employee Relief Scheme (TERS) benefits.

In a letter to Nxesi, Maynier said the lockdown had placed tremendous strain on several businesses, and employees have suffered financial and job losses as a result.

“The tourism and hospitality industry has already been hard-hit, and jobs are being lost as a result of the continued closure of the beaches, the curfew and the alcohol ban, which are having a devastating impact on businesses and jobs in the Western Cape.

“We have received many emails from businesses and individuals, who have held on for the past 10 months, but simply can’t continue to sustain their businesses or pay their employees with the current restrictions in place,” Maynier said.

Earlier this month, President Cyril Ramaphosa announced alert Level 3 restrictions will remain in place until 15 February.

The restrictions also include the ban on the sale of alcohol, a nationwide curfew and restrictions on gatherings.

Maynier has urged Nxesi to extend the UIF Covid-19 TERS support to qualifying businesses and employees in hotspot areas for the duration of time that the additional restrictions apply.

He said: “It is simply not fair to expect tourism, hospitality and liquor businesses to continue with limited operations or even close during the peak summer season without the necessary financial support to ensure they remain operational and can retain their staff during the Level 3 restrictions.

“As I understand, there is still money available within the UIF investment portfolio, which could be utilised for this purpose.”

He said the funds could provide the lifeline that businesses and employees need to sustain their operations while restrictions are in place.

“[It needs to be] made available as a matter of urgency if we are to prevent imminent business closures and further job losses,” he said.

In October, Nxesi told Parliament that the UIF has around R50 billion available.

He also said over R49 billion had been disbursed in TERS benefits in the form of over 11 million payments since the beginning of the lockdown.

In September, all Covid-19 TERS payments were put on hold after several allegations of corruption, and complaints that employees were not receiving their money.

Stopping the payments allowed the UIF to implement adequate controls and to mitigate the identified risks.

Nxesi said 1 688 government employees, who applied for TERS, were rejected.

Also rejected were two applications from inmates and 1 968 applicants with invalid identification numbers.

News24 is seeking comment from Nxesi’s office. It will be added once received.

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