Tourism Business Council of South Africa (TBCSA) boss Tshifhiwa Tshivhengwa reiterated the organisation’s calls for the UIF’s Covid-19 Temporary Employer-Employee Relief Scheme (Ters) to be reinstated on Tuesday, saying the industry is on its knees and many more thousands of jobs are on the line.
“The government needs to urgently reinstate UIF Ters benefits for hard-hit workers and businesses in the tourism, hospitality and liquor industries, or we need the extended lockdown alert Level 3 restrictions to be reversed,” he told Moneyweb.
Similar calls have been made by other tourism bodies such as the South African Tourism Services Association, the Federated Hospitality Association, and the Restaurant Association of SA.
Some unions and the Western Cape provincial government are also pushing for Ters to be reintroduced, particularly for the tourism and hospitality sector. This follows the extension of Level 3 restrictions until February 15 amid a second wave of Covid-19 infections in the country.
Bans on the sale of alcohol and the public visiting of beaches, rivers and dams, together with the 9pm curfew and restrictions on events, have dealt a new blow to the sector’s recovery.
Adding to the hospitality industry’s woes is the recent bout of Stage 2 load shedding.
“We maintain our position” notes Tshivhengwa. “We have always said that as long as there is this type of lockdown, there should be some sort of assistance for affected workers.
He says discussions about the possible reinstatement of Ters benefits have taken place between government, business and labour via Nedlac.
However, there “appears to be no response yet” from government or the UIF.
“The tourism sector is being highly impacted by extended Level 3 restrictions, some of which don’t make sense right now, such as the ban on [visiting] beaches, rivers and dams.
“In the traditional December peak, when some beaches are packed, the ban may have been sensible,” he says.
“However, it is not the busiest part of the year for tourism during this time [mid to late January] … Hence, all the beach ban is doing is killing what little tourism there might be right now for coastal cities and towns as well as leisure spots near dams and rivers.”
Tshivhengwa says trade in the sector, especially for restaurants, is also being affected by the 9pm curfew as well as the alcohol ban. In addition, the curfew has impacted airlines and the “night economy”.
Closures, job losses
“More restaurants are having to close their doors, because it simply is not profitable to keep them open right now. Hotels are also being affected, with establishments like the Hilton Durban temporarily closing, while others are yet to reopen. Something needs to be done, because people are losing their livelihoods.
“The government is using blunt instruments to curb the pandemic,” he says.
“It is high time that they relook lockdowns … The initial hard lockdown last year was meant to get our health system ready. We should have been better prepared for the Covid-19 second wave.”
David Maynier, Western Cape MEC of Finance and Economic Opportunities, also on Tuesday repeated calls for the Ters benefit scheme to be extended to affected tourism businesses “for the duration of time that the additional restrictions apply”.
According to the MEC, around R56 billion in Ters payouts was distributed between the end of March October 15, 2020.
Source of funds
“Additional payouts can be funded by the UIF’s total investment portfolio of R114 billion [as at March 31, 2020], which includes R60 billion in liquid assets and R54 billion in illiquid assets,” Maynier pointed out.
“These funds could provide the lifeline that businesses and employees need to sustain their operations while the restrictions on the economy are in place,” 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 alert Level 3 restrictions,” he added.
“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,” noted Maynier.