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South Africans will be confined to their homes from midnight on Thursday until the same time on April 16.

President Cyril Ramphosa announced the 21 day lockdown in a live address to the nation on Monday night.

People will only be allowed to leave their houses to shop for food and medicine, to get medical attention, or collect social grants.

 

All non-essential businesses must close over that period as well.

Exemptions will definitely include pharmacies, laboratories, banks, essential financial and payment services (including the JSE), supermarkets, petrol stations and healthcare providers.

Companies that are essential to the production and transportation of food, basic goods and medical supplies will continue operations.

 

ATM’s will also remain open, and the staff required to keep them functioning have been designated as essential services.

 

Ramaphosa says that the growing infection rate is extremely dangerous, given the large number of people with suppressed immunity because of HIV and TB.

He explained that the decision is based on the experiences of other countries, saying “the next few days are crucial.

Without decisive action, the number of people infected will rapidly increase from a few hundred to tens of thousands, and within a few weeks to hundreds of thousands.

Those countries that have acted swiftly and dramatically have been far more effective in controlling the spread of the disease.”

 

President Cyril Ramphosa admitted that business will suffer, and jobs will be lost.

But the President included a raft of economic packages to try cushion the impact.

The measures attempt to address the needs of people at all income levels.

 

Wage earners and grant recipients

  • Ramaphosa pledged to provide a safety net to support informal traders, although details are yet to be finalised.
  • There’ll also be tax relief  of up to R500 per month for the next four months to everyone earning less than R6,500 a month.
  • To alleviate congestion at payment points, old age pensions and disability grants will be available for collection from 30 and 31 March 2020, while other categories of grants will be available for collection from 1 April 2020.
  • Ramaphosa also made it clear that any employee who falls ill through exposure at their workplace will be paid through the Compensation Fund.
  • And, if necessary, the reserves within the UIF system will be utilised to support those workers in SMEs and other vulnerable firms who are faced with loss of income and whose companies are unable to provide support. Details of these will be made available within the next few days.

SMME’s

For SMME’s, the President promised a special dispensation for companies that are in distress because of Covid-19. Through this proposal, employees will receive wage payment through the Temporary Employee Relief Scheme, which will enable companies to pay employees directly during this period and avoid retrenchment.

  • SARS will work towards accelerating the payment of employment tax incentive reimbursements from twice a year to monthly to get cash into the hands of compliant employers as soon as possible.
  • Tax compliant businesses with a turnover of less than R50 million will be allowed to delay 20% of their PAYE liabilities over the next four months, and a portion of their provisional corporate income tax payments without penalties or interest over the next six months. Ramaphosa claims this intervention will assist over 75,000 small and medium enterprises.
  • Government, he said, is also exploring a temporary reduction of employer and employee contributions to UIF and employer contributions to the Skill Development Fund.
  • The Department of Small Business Development has also immediately opened a war chest of over R500 million to assist small and medium enterprises that are in distress – and promised access through a simplified application process.

The embattled tourism and hospitality industry has been singled out for special relief.

On Monday, the Cape Chamber of Commerce said that its research shows that many smaller operators in this sector face an existential threat.

To try prevent the collapse of those businesses, the Department of Tourism has made an additional R200-million available to assist SMEs in the tourism and hospitality sector who are under particular stress due to the new travel restrictions.

Industry

  • The Industrial Development Corporation has put a package together with the Department of Trade, Industry and Competition of more than R3 billion for industrial funding to address the situation of vulnerable firms.
  • That fund will also be used to fast-track financing for companies deemed to be critical to efforts to fight the virus and its economic impact.

The President had a stern warning for those hoping to game the system for financial gain. He said that Government expects all South Africans to act in the interest of the South African nation and not in their own selfish interests.

He pledged to act “very strongly” against any attempts at corruption and profiteering from this crisis.

 

Call for solidarity

Wrapping his address, the President called for unity over selfishness.

“In the days, weeks and months ahead our resolve, our resourcefulness and our unity as a nation will be tested as never before. I call on all of us, one and all, to play our part. To be courageous, to be patient, and above all, to show compassion.

Let us never despair.

For we are a nation at one, and we will surely prevail.”

Further clarity on the details of the new rules will be provided by a panel of cabinet ministers this afternoon.

That press conference has been scheduled for 14h00 on Tuesday.

Cape town news