All races must benefit from Covid-19 relief, says Tito Mboweni

06 May 2020 - 08:00
By Linda Ensor and timeslive
All enterprises, black and white, should be eligible to receive Covid-19 relief after being forced to close during the lockdown, finance minister Tito Mboweni says.
Image: 123RF/LIGHTWISE All enterprises, black and white, should be eligible to receive Covid-19 relief after being forced to close during the lockdown, finance minister Tito Mboweni says.

The government needs to support all enterprises in its Covid-19 relief funding, regardless of race, says finance minister Tito Mboweni.

“I think that we need to support all enterprises, black and white, as long as they are able to remain viable to support our people, create jobs,” Business Day reports Mboweni as saying.

He was addressing parliament’s two finance committees on Tuesday, regarding the Treasury's strategic and annual performance plans.

Trade union Solidarity is approaching the Constitutional Court to appeal against a high court ruling allowing the tourism department to use B-BBEE as a consideration when dishing out R200m in state relief funding to cushion the sector from the effects of the Covid-19 pandemic.

The union has also laid a charge of perjury against small business development minister Khumbudzo Ntshavheni for allegedly contradicting herself over her department’s decision to use B-BBEE as a criterion to help distressed companies affected by the coronavirus.

Mboweni said he had had a discussion with a white hotel owner whose business was successful in good times and whose employees were 95% black. The hotel, which was in a tourist area, was closed because of Covid-19 and the owner told Mboweni that he could not get money from the government because he was white.

Mboweni told him he was sure he was wrong and that he had misunderstood the position but would discuss the issue of the tourism relief fund with minister Mmamoloko Kubayi-Ngubane.

“There will always be a bias towards emerging black businesses because they were discriminated against for a long time, but let’s pull together and build a SA of our dreams, nonracist, nonsexist, and democratic and prosperous.”

Kubayi-Ngubane has said that the relief scheme does not discriminate against white business people as long as their businesses are B-BBEE compliant.

In a statement after the briefing, parliament's finance committees said the National Treasury had presented an annual budget of R33.1bn, which will be spent under seven departmental programmes.

“The committees held the firm view that the national disaster arising from the Covid-19 pandemic is not a licence to suspend application of the constitution and other legislation concerning procurement.”

Co-chairperson Joe Maswanganyi said procurement processes during the state of national disaster must be conducted within the framework of existing statutes, including section 217 of the constitution, the Preferential Procurement Policy Framework Act and the Broad-Based Black Economic Empowerment Act.

Zakhele Mbhele, the DA's shadow minister of small business development, welcomed “the finance minister’s rational and sober comments on this important issue and we hope that he will also include other ministers who have expressed support of demographic criteria for relief”.

The party said both the tourism and small business ministries intend to apply BEE criteria for relief aid.

It is bringing a court action against government’s “blanket discrimination during the national state of disaster”.

“We are seeking the court to declare it unlawful for government to use B-BBEE status and other demographic indicators as criteria to determine who will receive economic or other forms of relief. Our application will seek to establish a precedent across all sectors under the Disaster Management Act.”

Mbhele said: “We maintain that it is utterly unconscionable and unconstitutional for the government of a free and democratic country to employ B-BBEE, race, gender, age or disability criteria when offering assistance.

“The ship is taking on water and instead of doing everything possible to stop it from sinking, the government is pitching passengers overboard while floating rescue devices deliberately just out of reach.”