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Breaking! South Africa announces nationwide lockdown

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The National Coronavirus Command Council has decided to enforce a nation-wide lockdown for 21 days with effect from midnight on Thursday 26 March, ending on April 16th, 2020.

Key Points:

  • From midnight on Thursday 26 March until midnight on Thursday 16 April, all South Africans will have to stay at home.
  • The categories of people who will be exempted from this lockdown are the following: health workers in the public and private sectors, emergency personnel, those in security services – such as the police, traffic officers, military medical personnel, soldiers – and other persons necessary for our response to the pandemic.
  • It will also include those involved in the production, distribution and supply of food and basic goods, essential banking services, the maintenance of power, water and telecommunications services, laboratory services, and the provision of medical and hygiene products. A full list of essential personnel will be published.
  • Individuals will not be allowed to leave their homes except under strictly controlled circumstances, such as to seek medical care, buy food, medicine and other supplies or collect a social grant.
  • Temporary shelters that meet the necessary hygiene standards will be identified for homeless people. Sites are also being identified for quarantine and self-isolation for people who cannot self-isolate at home.
  • All shops and businesses will be closed, except for pharmacies, laboratories, banks, essential financial and payment services, including the JSE, supermarkets, petrol stations and health care providers.
  • Companies that are essential to the production and transportation of food, basic goods and medical supplies will remain open.
  • We will publish a full list of the categories of businesses that should remain open.
  • Companies whose operations require continuous processes such as furnaces, underground mine operations will be required to make arrangements for care and maintenance to avoid damage to their continuous operations.
  • Firms that are able to continue their operations remotely should do so.
  • Provision will be made for essential transport services to continue, including transport for essential staff and for patients who need to be managed elsewhere.

Public health management program

This nationwide lockdown will be accompanied by a public health management program that will significantly increase screening, testing, contact tracing, and medical management.

Community health teams will focus on expanding screening and testing where people live, focusing first on high density and high-risk areas.

To ensure that hospitals are not overwhelmed, a system will be put in place for ‘centralized patient management’ for severe cases and ‘decentralized primary care’ for mild cases.

Emergency water supplies – using water storage tanks, water tankers, boreholes, and communal standpipes – are being provided to informal settlements and rural areas.

A number of additional measures will be implemented with immediate effect to strengthen prevention measures. Some of those measures are that:

  • South African citizens and residents arriving from high-risk countries will automatically be placed under quarantine for 14 days.
  • Non-South Africans arriving on flights from high-risk countries we prohibited a week ago will be turned back.
  • International flights to Lanseria Airport will be temporarily suspended.
  • International travelers who arrived in South Africa after 9 March 2020 from high-risk countries will be confined to their hotels until they have completed a 14-day period of quarantine.

Economic Interventions

  • Following consultation with social partners, we have set up a Solidarity Fund, which South African businesses, organisations and individuals, and members of the international community, can contribute to.
  • The Fund will focus efforts to combat the spread of the virus, help us to track the spread, care for those who are ill and support those whose lives are disrupted.
  • The Fund will complement what we are doing in the public sector.
  • I am pleased to announce that this Fund will be chaired by Ms Gloria Serobe and the deputy Chairperson is Mr Adrian Enthoven.
  • The Fund has a website – www.solidarityfund.co.za – and you can begin to deposit monies into the account tonight.
  • The Fund will be administered by a reputable team of people, drawn from financial institutions, accounting firms and government.

To get things moving, Government is providing seed capital of R150 million and the private sector has already pledged to support this fund with financial contributions in the coming period.  

Government has had discussions with manufacturers and distributors of basic necessities, who have indicated that there will be a continuous supply of these goods. There is therefore no need for stockpiling of any items.

  • A safety net is being developed to support persons in the informal sector, where most businesses will suffer as a result of this shutdown. More details will be announced as soon as we have completed the work of assistance measures that will be put in place.
  • 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 01 April 2020.

All channels for access will remain open, including ATMs, retail point of sale devices, Post Offices and cash pay points.

Support people whose livelihoods will be affected:

  • We are in consultation on a proposal for 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.
  • Any employee who falls ill through exposure at their workplace will be paid through the Compensation Fund.
  • Commercial banks have been exempted from provisions of the Competition Act to enable them to develop common approaches to debt relief and other necessary measures.

Many large companies that are currently closed have accepted their responsibility to pay workers affected. We call on larger businesses in particular to take care of their workers during this period.

  • In the event that it becomes necessary, we will utilise the reserves within the UIF system to extend support to 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.

Assistance for businesses that may be in distress

Using the tax system, we will provide a tax subsidy of up to R500 per month for the next four months for those private sector employees earning below R6,500 under the Employment Tax Incentive. This will help over 4 million workers.

The South African Revenue Service will also 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 pay-as-you-earn 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. This intervention is expected to assist over 75 000 small and medium-term enterprises.

We are exploring the temporary reduction of employer and employee contributions to the Unemployment Insurance Fund and employer contributions to the Skill Development Fund.

The Department of Small Business Development has made over R500 million available immediately to assist small and medium enterprises that are in distress through a simplified application process.

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 and to fast-track financing for companies critical to our efforts to fight the virus and its economic impact.

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.

Source: CNBCAfrica