Department of Tourism Briefing: Policy Review Process (Green Paper); with Deputy Minister

Meeting report

Briefing by the Department of Tourism (DT): Green Paper on the Development & Promotion of  Tourism in South Africa

Deputy Minister remarks 

In his introductory remarks, Mr Fish Mahlalela, Deputy Minister of Tourism, took the Committee through the background of the legislation. He stated that, during the sixth Parliament, there was a draft amendment of the Tourism Act. It was felt there was a need for a total overhaul of the White Paper due to changes in the tourism space. An advisory panel was appointed to look at the gaps in the White Paper. Stakeholder engagements were held. There were discussions on the various policy imperatives ranging from governance, skills, quality, etc. Unfortunately, there were changes in the executive, and this caused delays in the process. The panel finalised its work and submitted the report to the Minister. Finally, the work was submitted to the Department. There have been consultations on the work. Hence, the Department presented the Draft Green Paper to the Committee but it has not been presented to Cabinet.

Ms Sibongumusa Ngidi, Chief Director: Strategy, Policy and Planning, apprised the Committee that the vision of the policy is to sustainably and competitively grow the South African economy through an inclusive, inspiring, visitor-oriented tourism sector that consistently builds partnerships to strengthen the impact of the sector nationally, regionally and globally. It is also to address barriers to tourism growth; and to respond to the social cohesion imperatives of the country.

She said that the objectives of the policy, amongst others, are to attract tourism investment and develop supportive tourism infrastructure, especially to drive innovation in the delivery of experience. The objectives also include ensuring sustainable tourism development; increasing the contribution of tourism to the broader economy through geographic, year-round spread of visitor volumes and revenue; and driving increased employment and entrepreneurship as an integral part of growth efforts, with particular focus on vulnerable groups.

She stated the main challenges were around the fact that the tourism economy of South Africa has not fully exploited its potential despite the significant successes registered since pursuance of tourism growth comprehensively, as signalled by the White Paper. The latest assessment in the economic survey of South Africa noted that the sector lags relative to its potential and considerable resources. The need to stimulate sustainable, inclusive tourism growth in line with its unrealised potential has also been recognised in various country-level economic revitalisation policies and strategies. Ms Ngidi informed the Committee that the new policy was based on a number of proposals, and the presentation focused on the core aspects of the policy document that the Department has developed. The document has details on the tourism economy and is comprehensive.

Regarding tourism governance and cooperation, she said that the problem was around fragmented planning that was slowing progress and undermining impact of tourism. It has been proposed that there should be harmony in delivering the tourism mandate by spheres of government, in line with the Constitution and national tourism policy. There should be one marketing message about the country and it should reflect the diversity of the destination (provinces and municipalities) and products. There should be a forum where the leader of government interacts with tourism stakeholders from both the public and private sectors regularly to oversee the implementation of agreed programmes.

Concerning transformation, she said that the challenge was around poor market access and opportunities for the previously disadvantaged along with low economic integration and entrepreneurship. It is proposed that the gains achieved so far have to be strengthened in implementing Tourism BEE Codes to contribute to the transformation effort, and to strengthen the framework for concessions working with National Treasury to promote transformation through the use of state-owned tourism assets. There should be mechanisms to recognise comprehensive internal skills development programmes by industry with the objective of more inclusive upward mobility of employees to be instituted.

On skills supply and employment, she indicated that the sector has inadequate supply of skills to meet industry needs due to poor conceptualisation of skills needs in the sector. This resulted in poor training of learners. And there were inadequate opportunities for internships, learnerships, coaching and mentorships, whilst some were unregulated for quality and relevance purposes. It was further pointed out that there was poor coordination between government Departments and agencies, training institutions and employers. It is proposed that there should be clear coordinated and consistent prioritisation of skills development and training through the review of the secondary and tertiary education curriculum and approach to tourism training to better incorporate intrinsic skills relevant to industry needs and to align with changing skills demands due to digitalisation. Encouragement of skills development by tourism enterprises and the sharing of best practices across the sector should be considered. It is further proposed that tourism should be positioned as a viable career within communities and to foster a greater understanding of the utility of service skills that the sector helps develop long-term for personal growth.

With regard to prioritising rural and peri-urban tourism, it was highlighted that rural and peri-urban tourism has suffered because, amongst other things, tourism attracts activity in urban centres, and there is poor profiling and visibility of rural products. There is also inadequate investment in outlying high tourism potential areas, and unresolved land disputes hinder tourism development. It is proposed rural and peri-urban tourism, as a driver of sustainable and inclusive development, should be elevated through investment in rural routes of high tourism potential and development of tourism niche framework (e.g., homestays) and packages to improve rural and peri-urban tourism offer. The mechanisms for community participation and beneficiation from the tourism value chain should be strengthened.

Pertaining to tourist services (tour-guiding, tour operators, and travel agents), there were numerous weaknesses in tourist services offerings in South Africa as a result of administrative challenges confronting the guiding sector profession and lack of attention on other tourism services sub-sectors such as the tour operators, travel agencies, accommodation and attractions in the current policy framework. It is proposed that there should be a focus on strengthening the powers of the registrar to review the overall process of administration of Tourist Guiding and consider expanding the powers of the registrar to include registration of tour operators, travel agents, and other categories applicable. The focus should also be on exploring the system of licensing for designated categories of tourism services, including a framework guiding the tourism levy regime.

In terms of destination marketing and branding, it is proposed a unified tourism competitive identity for South Africa should be developed and be focused on marketing programmes and investment based on evidence-based, priority market segmentation. There is a need for adopting a targeted approach to marketing and branding by country and region; establishing hosting of international business events enabling geographic spread and reduction of seasonality; formation of programmes for strengthening brand awareness and preference as a prelude to conversion. It is further proposed that South Africa should be positioned as a leader for international business events in Africa and in the Southern Hemisphere.

Touching on enhancing domestic tourism for destination resilience, she indicated that few tourism channels were being geared to grow and support domestic travel, and there were insufficient products, especially in the accommodation industry, to support low-income domestic travel. Awareness about what is available for the domestic market has been very low, and unemployment or lack of income continues to be a contributor to low domestic tourism activity. It is proposed that there should be prioritisation of Domestic Tourism with emphasis on enhancing market segmentation of the domestic market to better formulate strategies to inspire revenue-generating tourism amongst all segments with potential. A passion for travel among the youth to generate future demand should be cultivated. There is also a need to explore the feasibility of differentiated pricing as a tool for stimulating domestic travel, and to understand that it is in the hands of industry.

Lastly, on knowledge management, research and insights, Ms Ngidi reported that there had been a lack of readily-available market intelligence to inform decision-making in the tourism sector, and there was limited utility of research due to fragmentation in the identification of research gaps. There was no central repository of information enabling a better understanding of visitors – their habits and motivation. And there has been a lack of easy access to tourism information held in individual organisations in the public and private sectors. It is proposed an agreed-upon knowledge management framework and approach for tourism should be developed. It should include a regularly revised research agenda identifying research gaps and prioritised research focus areas formulated in collaboration with partners. Mechanisms should be in place to encourage data collaboration for decision-making in line with the legal framework for data governance.

Discussion
Ms S Xego (ANC) wanted to understand what could stand as security for SA job seekers in the industry because it appears to be exploiting non-South Africans. She asked if there was a quota that could be amended to protect South Africans. She also wanted to know how matters of transformation were related to the recent court judgement that led the Department to implement the BBBEE code. She then remarked that the grading system should remain voluntary and that the policy should encourage owners to establish their own establishments. Lastly, she commented that tourism investment should also focus or consider rural areas.

Ms Ngidi said that the Department of Labour was doing something about the matter of foreign labour. The Department of Home Affairs also has a role to play there. She stated that transformation needed to be strengthened. The Transformation Council would set the targets on the BBBEE code.

Mr Victor Tharage, Director-General, Department of Tourism, stated that the issue of the employment of foreign nationals had been raised from time to time. It rests with the Minister of Labour. The Department of Home Affairs has provided a suggestion of 49% on the employment of foreign nationals.

Deputy Minister Mahlalela said that the regulation on the employment of foreign nationals was the domain of the Department of Labour. He suggested that the Committee should interact with the Portfolio Committee on Labour for the interest of the tourism sector. It is critical that the Department intervenes in the process, and it is also important to upskill in the process. Special focus should be on the development of skills in the sector. He also said that the judgement did not throw away transformation. The 30% code was still applicable. The request for a deviation led to legal problems.

Ms H Ismail (DA) asked the Department to outline timeframes for reviewing the tourism crisis management framework and asked how it was going to be measured. She enquired what kind of trends were being monitored from emerging market trends. She wanted to know how markets were identified for e-visa requirements; asked how the process of economic infrastructure needs analysis would be undertaken; enquired about how the grading system would address inconsistencies in the sector, and if there were strategies in place to achieve this; asked how partnerships would be established with relevant parties to improve compliance with the grading framework; asked how skills needed in the sector would be bolstered, and how internships and marketing would be maximised for job creation. Lastly, she wanted to find out how the policy would improve the Culture, Arts, Tourism, Hospitality and Sport Sector Education and Training Authority (CATHSSETA) system.

Ms Ngidi stated that the SAT was looking at markets globally and analysing which markets it could invest in. Currently, there are 24 countries. This was being done regularly. She said that crisis management had been covered in the document developed by the Department. Currently, a draft strategy is being finalised. Concerning economic needs analysis, she stated there is an Integrated Transport Framework which caters for tourism as well, but it has pointed out that tourism has not indicated what it really wants. She said that the needed skills would be achieved through a simple mechanism. The need for skills changes from time to time in the sector.

Mr A Matumba (EFF) said that he thought the introduction on the background of the legislation from the Deputy Minister would agitate Members to do something because they want transformation in the sector. The disadvantaged must fight for their own economic infrastructure instead of being integrated into the white economic infrastructure. He said the policy should also talk about economic infrastructure in rural and peri-urban areas because investment has been lacking in such areas. He further pointed out that, when it comes to crisis management, the colonialists are the captains of the industry because they run to Europe when there is a problem. The BnBs in rural areas would not close because they were for sustainability, but not for profit.

On hiring foreigners, he stated that they were hired in the lodges because they were easily exploited and abused. The policy should also address the matter. Mr Matumba asked if there were strategies in place for that. He said that there was no link between rural and urban areas. There is a need to develop enterprises in rural areas first because, when they are developed, they would open branches in towns. He asked how the policy was going to address structural racism, because black people were not allowed to use swimming pools in some lodges.

Regarding responsible tourism for the destination, he suggested the start of a toilet revolution. He pointed out that tourists in China complained about lack of toilets. Toilets in SA were not properly cleaned even though people paid R2 for their use. In addition, the country does not make use of artificial intelligence, yet tourism has been taking place through computers, online bookings, etc. The policy was not talking about developing an application by the Department.

Ms Ngidi said that it was critical that government finds a way of working with the private sector and vice versa.

Mr Tharage stated responsible tourism has a social as well as an economic aspect. He also stated that the Department has consulted with colleagues in the ICT sector, and the Department is contained not to have authority to regulate on many platforms but could only regulate tourism-related activities. This area has been expanded to look at other areas and work with other bodies.

Deputy Minister Mahlalela stated that rural development should be linked to urban development. It cannot develop on its own.

Ms M Gomba (ANC) wanted to know if the Department considered the pastel model when it was doing its research and environmental scanning. She asked if global growth was considered when research on tourism was conducted, enquired if the country was on par with international standards in tourism, technologically; enquired if there were systems in place to ensure the Department was capable of carrying out this policy seeing that there were many vacancies in it, and wondered if the Department was SMART enough for this policy. She remarked that AfriForum was a stakeholder and needed to be given a chance to comment on the formulated policy to avoid going to court. She asked what the mission statement and value were of the policy. She also wanted to find out if the Department has data on the places it was marketing SA to; she asked if there were processes in place for the life cycle of the policy. Lastly, she asked how regularly the Department was reviewing its outdated policies.

Ms Ngidi, on the capacity of the Department, said that the implementation would be done at a sector level. The Department not only implements, but all the sectors that inputted implement on the programme as well. The strategies were being developed and regularly reviewed. The document talks about what the Department could do in areas where it did not have a mandate. It looks at various approaches that have an impact on tourism.

Ms Aneme Malan, DDG: Tourism Research, Policy and International Relations, said that they have been working with provinces on data and statistics collection. The statistics that have been used have the same definition. The Department also works closely with Stats SA, Home Affairs, and the South African Reserve Bank to ensure alignment when the collection of information is done. The parties involved monitor each other’s information and work together. Additional information is obtained by using existing surveys.

Mr Tharage said that, in the then interdicted Tourism Equity Fund, the Department wanted to go through a deviation process to fund transactions that were going to yield 51% ownership of black people. The law provides that the Department goes back to the 30%. He said that the issue of mission and values was covered in the strategic plan document. Strategies were being re-looked at any time after the national elections to look at the policies. Strategies are aligned with policy frameworks. Currently, there is a tourism portal that keeps all the research done and data simply.

Mr M De Freitas (DA) remarked that some parts mentioned in the policy, like education in tourism, did not purvey to tourism because that was the role of the Department of Education. He asked how the policy was going to address sites that were not easy to access in rural areas because they belonged to provinces that were not maintaining them. He also asked if compulsory grading was aligned to international standards, and if it would be free to small business owners because they would not be able to afford the fees. He wanted to know how the Department was going to ensure local authorities would look after the dilapidated sites. Lastly, he asked what the policy would do, because CATHSSETA was not addressing properly the appointment of tour guides.

Ms Ngidi indicated the mechanism for products to be graded had been covered in the policy. There is heavy subsidisation of smaller businesses.

Mr Tharage informed Members that, when it comes to compulsory free grading, one needs to have offices at the district level, with vehicles to travel. At that time, it was envisaged the needed budget was R100m, but there was no indication of where the budget would come from.

Mr K Sithole (IFP) sought clarity on the SADC tourism programme because the country has the NDP programme. He asked if the Committee could be given a document talking solely about transformation in the tourism sector. He also remarked that there was nothing that said about how the IGR would be implemented by the policy.

Ms Ngidi told the Committee that the focus of the presentation was on the core of the document that has been developed and which covers all the issues and proposals from the Members. The NDP is also covered in the document. The presentation focused on key proposals, and the document has all the details and is comprehensive on the tourism economy.

Ms P Mpushe (ANC) asked the Department to improve its capacity to ensure the success of the policy. She pointed out that the resolution on land disputes was the protection of government properties seeing that the Department was developing frameworks with the Department of rural development and land reform to resolve matters affecting investment. She also commented that the poor coordination between the Department and agencies is due to the lack of capacity and skills within the Department. Lastly, she proposed that the Department should work closely with Brand SA to enhance the marketing strategy for SA.

The Chairperson remarked that she did not understand why the Department spoke of tourism diplomacy instead of highlighting the sector as a contributor to economic growth. She enquired why the Department was speaking of Agenda 2063 instead of Agenda 2030; remarked that priority should be given to locals when it comes to employment because tourism could assist the country in mitigating against unemployed graduates in our country, and that the policy should point out that 95% of jobs in restaurants, tour-guiding, etc., would be prioritised for South Africans and five percent be given to foreigners; enquired what the specific proposals were on regulated frameworks and why the policy was not explicit on this because things like Uber, Bolt, etc., were not regulated; proposed to have another discussion with the Department on the policy for few days before it was given to Cabinet. Lastly, she remarked that the 54 million population figure from Stats SA was not an indication of how citizens were making babies every day, but the figure includes foreign nationals as well.

Mr Tharage, on Agenda 2063, said there is a part in the Green Paper that stated that tourism would not deviate from what the country wanted to achieve. He further stated that fly-by-nights were a big challenge when it came to tour operators and travel agencies. At the moment, there is a free for all approach.

The meeting was adjourned.