Cape Argus

Department will defend action against TEF


TOURISM Minister Mmamoloko Kubayi-Ngubane says her department is ready to defend the Tourism Equity Fund (TEF) in court.

She said she had instructed lawyers to defend the legal action brought by AfriForum and Solidarity that questions the constituti­onality of the TEF.

“We must re-emphasise that our efforts to transform the sector remains steadfast. We have instructed our legal representa­tives to proceed with our defence to stop attempts by AfriForum and Solidarity to oppose and render the criteria unconstitu­tional,” Kubayi-Ngubane said yesterday.

The TEF, launched in January, aims to provide a financing vehicle for black businesses and entreprene­urs to invest in businesses in the tourism sector. Investment in the fund amounts to more than R1.2 billion.

It was created in partnershi­p with the Small Finance Equity Agency (Sefa) and aims to help boost transforma­tion in the tourism sector, Kubayi-Ngubane said.

“The TEF is intended to fund majority black-owned and black management-controlled tourism enterprise­s (minimum 51%) in accommodat­ion, hospitalit­y and related services, and travel and related services, products and initiative­s,” she said.

The 51% black-owned minimum requiremen­t for funding has been described by AfriForum as racist and excluding other businesses from benefiting from the fund. The group said because the fund was launched as part of President Cyril Ramaphosa’s economic recovery plan, the transforma­tion component should be secondary to assisting all businesses affected by the pandemic.

Kubayi-Ngubane said her office had held meetings with AfriForum to explain that the fund was envisioned as far back as 2017.

Sefa, which administer­s the fund, was halted from continuing with making payments and receiving applicatio­ns to the fund after AfriForum won a court interdict in April. The court halted the fund until the main applicatio­n was heard.

Kubayi-Ngubane said it was unclear at this stage when the applicatio­n would be heard, but said she hoped the matter would be quickly resolved. She said black businesses were being heavily affected by halting the fund.

“Prior to the interdict, Sefa reported that the value of the rands of total applicatio­ns that qualify for final adjudicati­on stood at about R5.6bn.

“It must be noted upfront that the delays in implementi­ng the TEF will negatively affect black businesses which have already negotiated deals and applied for the funding through Sefa,” she said.

Solidarity and AfriForum said yesterday the minister had not followed proper processes to establish the fund. The organisati­ons insisted Covid-19 relief should not be racialised.

Ernst van Zyl from AfriForum said: “We look forward to facing the minister in court. She likes to mention that black-owned businesses suffer and that they should receive help but does not consider the white-owned businesses or their employees. The Covid-19 pandemic and the government’s lockdown regulation­s have affected all businesses in the tourism industry.”

 ?? MMAMOLOKO Kubayi-Ngubane ??
MMAMOLOKO Kubayi-Ngubane

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