SA Tourism Dept flooded by appeals for help from distressed businesses

Monday, June 21, 2021

The South African Department of Tourism continues to be inundated by hundreds of pleas for help from financially distressed businesses in the industry, hoping for a second phase of last year’s Covid-19 impact-related Tourism Relief Fund, but chances of this happening are slim.

The department’s director-general, Victor Tharage, said in a statement “it is regrettable that, while there is still a lot of demand for the funds, the department is not in a position to reinstate the Tourism Relief Fund owing to the unavailability of financial resources”.

“It is for this reason that the focus of the department is on the implementation of the Tourism Sector Recovery Plan to ensure a sustainable return to business activities as the mainstay of the recovery efforts,” added Tharage.

The enquiries currently flooding in to the department are in most cases from tourism enterprises whose applications under the fund were unsuccessful. Their applications either did not meet the criteria of the fund or there have not been enough funds available on the part of the department.

The fund only had R200 million available thanks to funding redirected from other sources.

The aim of the fund was to respond to the impact of Covid-19 on small tourism enterprises whose cash flows are largely dependent on daily activities. The funds were meant to assist with expenses like fixed and operational costs as well as supplies. Individual assistance was capped at R50 000.

Therefore, of the 7 284 valid applications submitted, only 4 000 businesses in categories such as accommodation establishments, conferencing facilities and venues, safari and car rentals in the tourism and hospitality sector received the funds.

Only enterprises with an annual turnover of not more than R5 million could qualify for the fund. To qualify, enterprises also had to provide valid proof of, among other things, the nature of the business, status of operations and Covid-19 impact as well as financials and tax clearance status. An attempt was also made to ensure funding was spread across the various provinces.

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