Let’s avoid another hard stop

Mid-September 2023 saw the release of a circular from the National Treasury which communicated the need for consideration of austerity budget cuts across the South African Government in the run-up to the Medium-Term Budget Policy Statement (MTBPS), which was delivered on 1 November 2023.

By Glenton De Kock, chief executive officer of SAACI

You may ask why we, SAACI, would want to raise this with you. Well, some of these measures are having, and may continue to have an impact on many within the meetings and events industry, either directly or indirectly.

While we appreciate the real fiscal constraints facing the state and the need to tighten and reprioritise expenditure, the solutions offered by the Treasury of slashing expenditure will further impede the state, when the economy is in desperate need of stimulus, and will only serve to choke the economy.

As citizens, we welcome the need by our government to manage the Fiscus a little better, but we may need to realise that we can find solutions to manage the fiscus more effectively. The meetings and events industry is a significant financial contributor to the fiscus and the work we do within the communities we serve.

With the past year’s operating environment being a challenging one to date, the meetings and events industry has always managed to work through these challenges.

What we don’t want is a hard stop, as we had during the pandemic. We have already seen a pullback from the government on meetings, events and travel as well as in-person engagements in certain parts of our country. This ripple effect is felt throughout the value chain and may lead to a further slowdown of activities by corporates as well.

We are clear in welcoming the need for the government to manage the fiscus. It must be done in a way that has one eye on stimulated growth that helps the communities we serve, as the government steadies the ship economically. This is the time for government to activate that social partnership they speak about. As an industry, we have reached out to engage with the necessary parties and have raised our concerns, by providing solutions that may be considered.

Aggressive austerity measures in South Africa can lead to reduced government and corporate spending, decreased tourism promotion, lower attendee participation, venue changes, strain on event suppliers, and potential long-term impacts on the industry’s growth and development.