Tourism body struggles to pay staff

The newly formed South Coast Tourism and Investment Enterprise (SCTIE) is struggling to pay its employees due to a lack of funds.

The investment and tourism body paid its employees only 50% of their May salaries.

In a statement, SCTIE’s Acting CEO, Deborah Ludick, said the organisation might be in a similar position in June, saying that the balance of the 50% May payment will follow as soon as funds are received.

Although, comment from Ludick relating to what happened to the funds injected by all four local municipalities under Ugu District Municipality during the 2023/24 financial year had not been received at the time of going to press. In a statement, she said this was due to unforeseen cash flow constraints.

“As a municipal entity, we are heavily reliant on municipal grant funding, and in particular from our parent municipality, Ugu District Municipality, who has advised us that they are not in a position to process our payments, saying that this should be remedied by July 15. We understand the importance of fulfilling our financial obligations to employees on time and are committed to finding a solution that works for both parties,” read the statement.

She added that while exploring options to address the issue, they are hopeful for a resolution.

When Fever queried with Ugu District Municipality communications department about the funds promised to SCTIE in July, the municipality acknowledged receipt of the query but did not respond.

A few hours after Fever’s query, Ugu took to social media to release a statement on SCTIE’s financial challenges.

The statement read: “The municipality has noted with grave concern the widely publicised financial distress affecting the salaries of the SCTIE staff. This is a municipal entity that has been mandated to drive investment in all economic sectors of the district. As such, it has a full board being entrusted with the fiduciary duty to drive the strategic objectives of the enterprise. Like all other municipal entities, the SCTIE is allocated grant funding from both the parent municipality and the family of municipalities under the district. And the budget allocations made to the entity are under the existing service level agreements being entered into as is the case for the new financial year.”

According to Ugu, a new strategic plan to give effect to its mandate is being finalised.

“A reviewed funding model has been adopted for implementation, which provides for grant funding and income-to-grant ratio to be achieved over time. With this reviewed funding model, it is envisaged that the entity will effectively fulfil its mandate sustainably and achieve its objectives which align to the district’s economic targets,” read the statement.

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