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Over 200k workers could lose their jobs in WC due to COVID-19 - Treasury

The provincial Treasury Department head David Savage said of the over 200,000 job losses predicted, several came from the tourism industry.

FILE: It was estimated that half of all tourism businesses could close down. Picture: 123rf.com

CAPE TOWN - The Western Cape Treasury said 240,000 people could lose their jobs due to the coronavirus pandemic.

It said this was a preliminary estimate as businesses across the country buckled under the financial pressures brought by the virus.

The provincial Treasury Department head David Savage on Sunday said of the over 200,000 job losses predicted, several came from the tourism industry.

“Up to 43% of all Western Cape job losses are around tourism and tourism-related activity,” Savage said.

It was estimated that half of all tourism businesses could close down.

Savage said the construction industry was expected to account for 17% of the job losses.

He said these preliminary estimates were based on modelling done by the Department of Economic Development and Tourism.

“They have used a social accounting matrix model with some deep econometrics modelling. It is based on scenarios, on assumptions of the length of lockdown,” he said.

He added this modelling would inform the economic recovery plan, which would be communicated in due course.

BBBEE REQUIREMENT FOR RELIEF FUNDING

Meanwhile, Cape Town Mayor Dan Plato has launched an intergovernmental dispute against the Department of Tourism over its prioritisation of black businesses when awarding the tourism relief fund.

The fund was subjected to court battles and criticism since it was established in April.

AfriForum and trade union Solidarity have taken the government to court over its criteria that beneficiaries be Broad-Based Black Economic Empowerment (BBBEE) compliant.

Plato wanted the tourism ministry to remove its BBBEE criterion for relief funding.

“This is to save thousands of jobs as the City of Cape Town and the Western Cape economy are dependent on the tourism sector,” Plato said.

Only 4% of tourism businesses surveyed by Cape Town Tourism had the resources to survive for more than a year. A third of the respondents had put staff on unpaid leave and almost 20% retrenched employees.

Plato said the city had sent numerous letters to Tourism Minister Mmamoloko Kubayi-Ngubane, but the responses were unfavourable.

He said the city had requested a meeting on Tuesday in terms of the Intergovernmental Relations Framework Act.

For official information about COVID-19 from the Department of Health, please click here.