Pravin Gordhan trims travel fat, industry bleeds…

Today the Minister of Finance, Pravin Gordhan announced major cost-cutting measures during his Medium Term Budget Policy Statement 2013. This exercise is aimed at saving the tax payer over R2 billion per year.

The travel and tourism industry will be hugely affected by these new restrictions which will come into effect as of 1st December 2013. This means the travel trade will lose substantial revenue streams which were as a result of doing business with government. This is across the board…from hotels, conference venues, car hire, flight tickets and meals.
sa tourism
Below is the breakdown of forthcoming changes which are directly connected to the travel and tourism industry:

Overseas delegations:

  1. Business Class only for Ministers
  2. Assistants to Ministers will be limited to two
  3. Direct routes will be used
  4. Number of officials to be kept to a minimum.

Housing:

  • Ministers awaiting allocation of houses will be accommodated in rented apartments not hotels

Travel and related costs:

  1. Hiring of cars to be restricted to B-Class except for special instances such as rural travel
  2. The number of officials travelling to Cape Town offices will be limited
  3. The Leader of Government Business will engage with Parliament on measures to reduce costs, such as the size of delegations appearing before parliamentary committees, and the cost implications of the current Pretoria-Cape Town arrangements
  4. Business class for overseas travel for DGs and DDGs only
  5. Business class for DGs only on domestic flights.

Catering and event costs:

  1. Guidelines will be developed for reducing event costs, including better use of government facilities rather than outside venues for meetings
  2. No public funds to be used for purchase of alcohol
  3. The entertainment allowance will be limited to R2,000.

Author: Muzi Mohale

Hi there, am your host and I blog about the tourism industry in South Africa. You’re also welcome to contribute your expert content on matters affecting the industry. You can reach me on muzi[at]tourismedition.com

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