Restaurants Association’s lawsuit over non-use of liquor licences could cost govt R1bn 

Staff at a popular Sandton bistro were left with no income and an uncertain future since the restaurant closed its doors in March.

In the hours before Sunday night’s announcement of the liquor ban, the managers and workers at Del Forno in Flora Park, Roodepoort were already preparing for the worst. Although the place was opened, with tables laid in the hope for a few sit-in customers, the restaurant was only populated by staff.

But there was activity in the parking lot where delivery scooters were being revved for take-off by masked men, headed for customers who were largely staying away from the outside world.

Wendy Alberts, CEO of the Restaurants Association of South Africa, was notably frustrated and spoke with deep concern as she relayed some of the stories she had to listen to on a daily basis of members finally deciding to shut down after months of hoping against hope.

“If there is truth in the numbers on what the government is presenting in terms of what they are saying in terms of the hospitals then we have to respect the leadership of the country,” she began.

But after months of a mostly one-sided attempt to collaborate with the government on viable solutions for the industry, the industry was left with little leverage to fight with, except in the courts. In the meantime, about 400,000 jobs were on the balance as, according to Alberts, hundreds of establishments were already closing their doors indefinitely, while a few had hopes of reopening in September by which she hoped the ban would be lifted.

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On the morning after President Cyril Ramaphosa announced the reinstatement of a national curfew and a ban on liquor sales and distribution, Alberts was sitting with lawyers discussing the options available to her members who suddenly found themselves unable to run a proper dinner service and unable to sell liquor which accounts for at least half the revenue in much of the industry. Not that much liquor had been sold over the past few uncertain weeks.

Establishments representing over 100,000 liquor licences which have been rendered unusable over the past few months, were teaming up to sue government for the R7,000 each rebate due to them for the non-use of their liquor licences. A class action suit which, if  successful, could cost government over R1 billion.

“We are seeking council today with our attorney and Advocates Mooney Ford to see what claim we have against government for damages on non performance and restrictions of our liquor licences and the regulations regarding the substantiation on the curfew..” read a memo sent out by Alberts to Rasa members, stating this was in the hopes that it could pressure government to heed their cries for help.

“We have reopened our restaurants, we are there we are fighting we are trying to restart the economy,” said Alberts, a restaurant owner herself. “We are trying to save jobs trying to save livelihoods and without consultation and any warning we are shut down with a double blow –  no alcohol and curfew. How will people finish their dinner by 8 ’O’clock, she demanded.

Ramaphosa’s latest decisions on Covid-19 followed a shocking upsurge in daily cases of the deadly disease which was attributed to the reopening of several industries, fewer restrictions on freedom of movement and the unbanning of liquor sales and distribution.

Private and public health sector bodies have decried the increase in trauma cases, which have been linked to alcohol abuse, placing a burden on an already fragile health system. The new restrictions were instated as an attempt to curb this upward trajectory of new cases and supposedly relieve the pressure on the health sector.

Staff at a popular Sandton bistro were left with no income and an uncertain future since the restaurant closed its doors in March.

When it reopened for deliveries and take-aways recently,  a chef at the establishment claimed most of them had been left in the cold. Financial constraints at the restaurant led to management resorting to leaving some of its permanent staff on hiatus while temporary arrangements were made without them.

“When sit-downs opened, everybody went back to work except for the chefs he did not take back and replaced with chefs from his wife’s shop. Since then we have been struggling to pay rent and to do things. We cannot pay bills and we have no income whatsoever,” said a despondent chef.

Meanwhile the tourism industry was sounding similar warning bells about mass retrenchments in the broader sector, which could see most of its 600,000 jobs shed ndefinitely. This grave warning came from The Tourism Business Council of South Africa (TBCSA).

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The group’s board held an urgent meeting to ‘discuss way forward’ for the sector this week, following numerous attempts to convince government to allow a phased reopening of the tourism sector, especially the use of leisure accommodation under lockdown Level 3. “ …the industry has decided to consider its options to stop the daily R748m loss of tourism expenditure and the further permanent loss of much needed jobs,” urged Tshifhiwa Tshivhengwa, CEO of TBCSA. .

“We have tried appealing to government since the Level 3 lockdown was announced, however, our appeals were not adequately considered. As a result, we have no choice but to weigh our options on the relief that will protection and save businesses within the sector as well as the value-chain of tourism and hospitality, otherwise the industry is facing permanent closure.”  he said, implying the group wanted to take action to force government to intervene.

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