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Health disaster will have devastating consequences for thousands of businesses

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DA pledges support, offers proposals for economic support package

Dear MyPE

Today, I wrote to Minister of Finance, Tito Mboweni, to offer the Democratic Alliance’s full support to him and the National Treasury for the responsibilities they will bear in fighting Covid-19.

We have also proposed an economic support package to help small and medium businesses weather the storm over the coming months.

We hope these proposals will be seriously considered and that the government will soon announce measures to avert or lessen the economic devastation that this virus will cause. It is a cause for concern that there has been no comprehensive economic plan announced to coincide with the comprehensive containment plan.

It is beyond doubt that this health disaster will have devastating consequences for thousands of businesses and millions of employees.

The DA’s proposals to the Minister of Finance include an economic support package that will help small and medium businesses ride out this storm without laying off staff or closing down.

They include:

  • A nation-wide four month payment holiday on loans for small and medium businesses, in particular, property loans, business loans, and vehicle loans;
  • A pause in rental payments, or a reduction in rental payments;
  • The Department of Labour could pause payments for UIF and Worker’s Compensation Fund by small businesses for four months, without affecting workers’ cover under these funds;
  • Those local governments that can afford it should offer rates relief to businesses in their jurisdiction;
  • To protect businesses from bankruptcy, 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

It is my hope and expectation that the government will soon announce a decisive economic response that matches the decisiveness of its virus containment plan. I hope that in a year’s time when we look back on this period, we will see that this was the time South Africa showed it’s very best in unity and co-operation.

Regards

Geordin Hill-Lewis MP
DA Shadow Minister of Finance

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