Johannesburg - The hospitality industry has been the latest voice to raise concerns about the impact of the National Treasury’s recent announcement to reduce spending across all national and provincial departments.
The instruction by the Treasury issued to all state institutions in August gave the directive for budgets to be slashed through a number of mechanisms, including the freezing of all vacancies and infrastructure roll-out programmes.
The decision has come under fire in recent weeks by a number of trade unions and organisations representing workers and various industries.
The hospitality industry said while it understood the Treasury’s bid to bolster fiscal responsibility and reduce government spending, it was apprehensive about what this would mean for the industry as it included restrictions on travel, conferences, and catering, to name a few.
Alan Campbell, the sales and marketing director for Anew Hotels and Resorts, said although well intentioned from a fiscal perspective, the decision was of great concern to the hospitality industry.
“The tourism and hospitality industry relies heavily on government-related travel, bookings, and events. This announcement could jeopardise tourism just as we were recovering from a series of unprecedented challenges, including the Covid-19 pandemic.
“The industry serves as a gateway for unskilled individuals to enter the workforce, offering opportunities for skills development through in-house training programmes and the chance to earn a decent livelihood. However, we are concerned that the Treasury’s announcement could jeopardise employment in this sector,” he said.
Campbell stressed that this was vital to consider as the hospitality industry was not just one of the largest employers in the country, it also provided jobs to a diverse range of individuals with immense potential for addressing the youth unemployment rate.
If anything, he called for a more consultative approach with industry bodies to plan for and assess the long-term consequences of the restrictions and to offer a time frame within which to adjust.
“A reduction in government-related travel could lead to a freeze on new appointments, reduced working hours, and the postponement of upskilling programmes. This, in turn, would have a detrimental effect on the livelihoods of many people and could exacerbate unemployment rates,” Campbell warned.
The Federated Hospitality Association of Southern Africa said it was also interested in how the recent budget cuts and, in particular, the sections travel, conferences, workshops, and catering, would affect the industry and its members.