Minister Kubayi-Ngubane: Dept to defend Tourism Equity Fund in court
Tourism Minister Mmamoloko Kubayi-Ngubane has reiterated the department's intention to defend the court case around the constitutionality of the Tourism Relief Fund.
The fund is part of the president’s Economic Reconstruction and Recovery Plan, announced in October last year, in response to the pandemic.
The disbursement of money has been prevented by a court case.
Solidarity and AfriForum launched an urgent application after Kubayi-Ngubane announced the department’s fund which is only accessible to people who qualify for Black Economic Empowerment (BEE).
The minister briefed the media on Monday morning.
“Since the launch, our effort as government to transform the tourism sector has been frustrated by a court challenge brought by Afriforum and Solidarity. Last month, the High Court in Pretoria interdicted the processing of applications for TEF. The court felt it necessary to temporarily halt the processing of TEF until such time that the main application in the matter can be heard.
“Today, we announce our intentions to defend the main case in court regarding the constitutionality of the criteria, which is part B of the court application,” announced Kubayi-Ngubane.
Afriforum and Solidarity are contesting the legality and rationality of the 51% black owner or managed qualification criteria for the fund.
Kubayi-Ngubane said Solidarity and AfriForum wanted the department to repurpose the funds to provide for financial relief to businesses affected by Covid-19, arguing that transformation of the sector should be secondary to the Covid-19 relief measures.
“Given that the sector, based on the state of transformation reports had already called for such a fund as far back as 2016/17 financial year, there was no doubt as to the policy intention of the Tourism Equity Fund which is to boost sector transformation. Furthermore, it was clarified that TEF is not blind to the impact of Covid-19 but supports transformative and inclusive reconstruction the tourism sector,” she said.
The minister added that there is a lack of transformation in the sector with the majority of tourism enterprises failing to meet the 30% ownership target as per the tourism B-BBEE codes and most black entrepreneurs struggle with funding.
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