Posted on April 29, 2020

Tourism: Decision to Give Relief Funds to BEE Firms Faces Legal Challenge

Tom Head, The South African, April 28, 2020

Judgment in the case against the Department of Tourism was reserved on Tuesday in the Northern Gauteng High Court. The verdict will be delivered via email to the parties involved within the week. Both complainants believe that the R200 million support fund is racially discriminative towards some South Africans.

The fund was created to assist establishments such as resort properties, B&Bs, guest houses, lodges and backpackers, restaurants (not attached to hotels), conference venues (not attached to hotels), car rental companies, tour operators and travel agents.

To apply for a once-off capped grant of R50 000, businesses must be small, micro and medium-sized enterprises (SMMEs). But the department’s announcement that BEE is also a key factor has raised the ire of some. The Democratic Alliance (DA), Solidarity and AfriForum had all threatened to take legal action against tourism minister Mmamoloko Kubayi-Ngubane, with the latter two making good on their promises.

Solidarity’s Dirk Hermann attended the court session – which featured a range of social distancing measures and the mandatory use of masks for those inside the gallery. He argued that prioritising BEE-specific companies does nothing to “rectify the inequalities of the past”. A decision on the matter is pending.

“The purpose of black economic empowerment (BEE) is to rectify the inequalities of the past. The Tourism Relief fund should not go over those previously disadvantaged, but for survival.”

“This isn’t just a crisis that affects certain people. The whole of South Africa is in crisis. The tourism sector is hit heavily, but the department of tourism has, unlike the global health crisis, looked at race and decided to discriminate against you based on your skin colour. “

Dirk Hermann