DA proposes relief measures for businesses affected by coronavirus contagion.
The Democratic Alliance (DA) has proposed several initiatives that the government can implement to help business ride the current extraordinary environment caused by the coronavirus outbreak.
In light of the increasing cases of Covid-19 reported in South Africa, president Cyril Ramaphosa on Sunday declared a national state of disaster to contain the coronavirus. The president announced measures aimed at containing the virus that will impact schools, international and domestic travel and businesses.
DA leader, John Steenhuisen on Tuesday outlined proposals to assist government in fighting the virus.
“It is safe to say that we are on the precipice of a full-blown national crisis, the implications of which will be devastating to our society, our economy, and ultimately, our future as a nation. Especially given that South Africa was in a precarious economic state prior to Covid-19’s arrival.”
Steenhuisen said that the DA has already pledged its full support to the fight against the spread of Covid-19 in South Africa, “and we remain committed to working side-by-side with National Government to stop the spread of this virus and ensure the safety of each and every South African”.
The opposition party lead said that the DA will submit a number of recommendations to the president at a multi-party meeting being held in Cape Town on Wednesday, including:
- A four-month loan forbearance for businesses. A forbearance is a temporary postponement or ‘holding back’ of a payment. It is a form of repayment relief granted by a lender or creditor.
- A four-month rental forbearance for small businesses.
- Pause in VAT, UIF and Worker’s Compensation Fund payments and outstanding VAT refunds should be paid to businesses urgently, and new VAT payments should be deferred to later this year.
“We propose that business rescue proceedings should receive an automatic three month extension beyond the three months provided for in S132 of the Companies Act,” said Steenhuisen.
Companies facing distress due to the pandemic to be assisted
As measures are put in place to contain the spread of the coronavirus pandemic and its impact, Employment and Labour minister Thulas Nxesi said individual companies are to feel the pinch and may lead to some of them being distressed.
Nxesi said to assist the distressed companies, a period of reprieve will be considered in order for companies not to contribute to the Unemployment Insurance Fund (UIF). He said the Funds Temporary Employer/ Employee Relief Scheme will be used to ensure that workers are not laid off.
“In instances where companies decide to close for a short period as a precautionary measure, the short term UIF benefit will kick in. If a company contemplates a short term shut down, they are required to inform the Unemployment Insurance Fund. Our team will visit these companies to provide assistance with the processing of the claims,” said Nxesi.
He said in instances where an employee has to be self-quarantined for 14 days, such a leave will be recognised as a special leave which will be fully paid on condition that the reason for the quarantine meets the requirements and that employee can apply for UIF benefits.
In an event that an employee is required to be quarantined for longer than 14 days as a result of having travelled or been in contact with an infected person, such a leave will be recognised as a special leave and that employee will be eligible to apply for unemployment insurance benefits, added Nxesi.
Call to Action
Covid-19 is a collective issue which can only be solved through a collective response, and South Africa needs everyone to get on board, Steenhuisen said.
“We need to understand that while the virus may not be fatal to ourselves, it may cause the death of someone who may contract the virus from us in the greater chain of infection.”
“I want to appeal to the private sector to consider adapting its operations where possible to accommodate the president’s announced contingency measures,” said Steenhuisen. “This includes allowing staff to work from home, providing less densified work environments for essential staff, and ensuring that workplaces are clean and sanitised at all times.”
“I also want to call on big business to get involved. Telecommunications companies such as Vodacom, MTN, Cell C, and Telkom should consider making discounted or free data packages available for students accessing online learning platforms remotely,” he said.
Telkom said on Monday that it will zero-rate educational websites as well as those that information the population about the Covid-19 coronavirus. Zero-rated educational websites primarily comprise the educational facility websites of universities and colleges.
The private healthcare sector can assist government in augmenting patient capacity and providing additional medical supplies to regions where they are needed.
The DA lead also called on private medical aids to make Covid-19 testing freely available on all plans without unnecessary conditions in order to fast track detection and quarantine.
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