A Lesson for all Tourism Offices who whinge about inadequate budgets

Most tourism offices whinge about inadequate budgets without demonstrating that they do provide value for money or create significant numbers of extra jobs with taxpayers’ funding.

Well, Swellendam has turned the “liability” of development on its head and gained itself a cash budget of R11 million a year for the next three years.  And there’s much more in kind.

Brand Swellendam is the winner and it’s a credit to the board of Swellendam Tourism Organisation (STO) and the Municipality that this has been achieved.  And to Peter Gratton for his dedication and perseverance — the submissions to DBSA were rejected twice before a visit to them convinced them of the benefits.

We (that includes Beezus) met Peter Gratton, who drove the project, and Rob Hicks, Swellendam Tourism’s development planner (discovering that we had crossed paths in a previous life) over breakfast at the pet-friendly Grace Walk B&B.  It was a memorable breakfast in every respect… thank you Esther.

Rob Hicks, development consultant, and Peter Gratton, head of Swellendam Tourism

Rob Hicks, development planner, and Peter Gratton, head of Swellendam Tourism

The Swellendam Tourism Economic Empowerment Project, or STEEP for short, is a Jobs Fund project originated and implemented by Swellendam Tourism Organisation.

The project was conceived in 2012, awarded in 2014 and commenced in January 2015. It has a term of 3 years, until December 2017.

The project has a state-approved budget of R51m over 3 years, R13m of which comes as in-kind contributions. The project is designed to deliver on the mandate of National Treasury’s Jobs Fund, which is a challenge fund tasked with uncovering and supporting innovative projects that show promise in catalysing economic growth and jobs as well as transformation and systemic change in priority areas and economic sectors.

To be awarded funding in Round 3 (2013-14) STO had to compete as one of 3,000 applications made nationally, from which only 22 projects were ultimately successful.  STO is the only LTO in the country so far entrusted to implement a Jobs Fund project, out of 91 projects and several billions of rands awarded so far.

Only one other project, in the Eastern Cape, is tourism-related.

The viability and credibility of the project logic and the organisation and key people behind it were subjected to more than a year of due diligence by National Treasury and the DBSA before the award was made.

What will it deliver?
STEEP’s targets are to create 837 permanent jobs, 38 new SMME enterprises, 1,500 workplace skills development opportunities and to grow the local tourism economy by a minimum of 10% in real terms over the next three years.

In whose name was this project conceived; who will be implementing it and who is controlling the money?
STEEP is the return on five years of sustained investment in tourism by the Swellendam Municipality, whose vision for shared prosperity has underpinned their funding to  STO through a service level agreement since 2009.

STEEP is designed to respond to national, provincial and local priorities as defined in the NDP, National (and Rural) Tourism Sector Strategies, the Western Cape Economic Development Plan (it anticipated Project Khulisa before it had a name) and the local and district IDPs, to the direct benefit of the local economy and community at large.

STEEP will be implemented by STO, which is a non-profit organisation in good standing in terms of the NPO Act 1997 and registered with SARS as a tax-exempt Public Benefit Organisation.  The STO Executive Committee has full authority and responsibility for the project.  Yet, in terms of STO’s constitution, no STO/Executive Member has any ownership in the assets or money of the STO; these are managed by a professional staff employed by STO, led by General Manager & Executive Project Director Peter Gratton, who originated and designed the project.

STO doesn’t get the money up front: projects are audited every three months by the Government Technical Advisory Centre (GTAC) at National Treasury before funds are released.

Who will benefit — probably STO members, right?
Wrong; the project has a non-negotiable policy (set by STO, not by anyone else) that 95% of the funds will be expended in the Swellendam municipal area, and that 95% of the new jobs, enterprises and training opportunities will go to black people living in our disadvantaged communities, with a clear focus on women,youth and other historically disadvantaged people.

Where is the money going to be spent?
Of the 95% above, the majority will be expended in the three main tourism centres of Swellendam, Suurbraak and Barrydale.

That does not exclude other areas or people from benefiting from the jobs and opportunities created — it simply means that STEEP does not anticipate making direct investments outside those tourism hotspots.

How can local people apply for grants and loans from this project?
You don’t, every cent of the entire three year budget is allocated and committed according to a budget approved by National Treasury;  no person or body may vary the budget without permission of National Treasury, no matter what the source of the funds.  This guarantees transparency and dispenses with all notions that people can run off with the money or that STO can be partial or apply favouritism in or its own discretion in spending the money.

Why are the senior staff and executives of the STO white people?
STO membership is free to any person who can’t afford it, and election to the board is open to any member, but the fact that the committee has not been able to attract and or retain black people reflects the fact that the Tourism industry is owned 95+% by white people, for historical, cultural and economic reasons.

STO recognises this as being unsustainable and grossly unfair, which is one reason why this project was originated in the first place.

Watch this space; you will see a very significant difference within 6 months.

In terms of staff: in order to deliver the targets and produce the maximum benefits to local black people we need the best staff available; therefore temporary contracts will be awarded on merit, irrespective race or any other irrelevant criteria. This policy is approved by National Treasury.

Again, watch this space and look again in 6 months

How can I get involved or find out more?
Any bona fide would-be entrepreneur or anyone else seeking specific information on opportunities is welcome to contact the project, initially through the Swellendam Tourism Office on 028 514 2770, or at

STO will be embarking on a wide range of public meetings and stakeholder engagements over the coming weeks; ask your Councillor for more details and pressurise them to give you full and timely feedback.

Furthermore, STO is actively seeking development- and transformation-minded people with relevant high-level skills and/or representatives of key stakeholders to join the project’s advisory committee.  Applications are open to individuals, but delegates of properly-constituted local bodies/CBOs are preferred. Expressions of interest should be made via the above email address or by contacting any memberof the staff or Executive of the STO in person.

STEEP will soon be creating a web page where all news, opportunities and even STEEP accounts will be available to the public.

STEEP is aptly named: led by Swellendam Tourism, it is a partnership bringing together national, provincial and local government as well as Wesgro, SANParks and others.

STEEP sprang from a wider landscape-level vision which links conservation to socio-economic development in rural areas, and argues that tourism is the only viable engine that can drive this rural economy and deliver jobs and a better quality of life for people in the region’s disadvantaged rural communities.

STEEP has four main focus areas:
1) Job Creation
mainly through Workplace Skills Development, mainly in SMMEs connected to the Tourism Industry;

2) Enterprise Development
in the above sphere;

3) Transformation and Diversification
of the racial profile of those involved in tourism, through new black-empowered tourism offerings; thereby mainstreaming black people into the industry; and

4) underpinning all the above, a Responsible and Sustainable local tourism economy; through:

a) enhanced and joined-up Destination Marketing, focused on linking the mainly white-owned hospitality sector with emerging black-empowered tourism activities and suppliers of goods and services, and

b) piloting a new way of making best use of tourism and recreational facilities under the curatorship of the municipality; these are often degraded and ineffectively managed due to the financial pressures on municipalities deriving from the necessary focus on basic services.

Tourism is clearly not a basic service, but it is a fundamentally and critically important economic driver — hence this project aims to test what happens when state investment and private sector skills are applied to assist a municipality in the operation of such sites; and evaluate the potential for such arrangements to fund local tourism organisations, instead of them and these types of properties continuing to be a drain on municipal resources.

3 thoughts on “A Lesson for all Tourism Offices who whinge about inadequate budgets

  1. impangele

    Incredibly hard work and dedication went into getting this plan into place: sheer determination on behalf of both the Tourism Organisation and members of the Municipality who were prepared to take a stand to make the (much needed) mind-set changes. We are all hoping that the cooperation and the energy needed to take this onto the next level will be apparent from every sector of the community. If Swellendam succeeds, what a beacon of hope for the tourism industry!

    Reply

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