Assembly seeks clarifications on administrative process and delays in FA4JR scheme | 06 May 2020
Minister for Finance, Trade, Investment and Economic Planning Maurice Loustau-Lalanne and secretary of state for Finance Patrick Payet appeared before the National Assembly yesterday morning to address a Private Notice Question (PNQ) by leader of the opposition Wavel Ramkalawan, regarding salary payments for persons employed in the private sector and self-employed individuals, as announced by President Danny Faure during his address on COVID-19 on March 20, 2020.
The scheme, announced by President Faure which has since been named the Financial Assistance for Job Retention (FA4JR), guarantees salary payments for all employees, including private sector employees and employers for the months of April, May and June to mitigate the economic implications the pandemic has and continues to have. The first phase of payments was initially scheduled for mid-April.
Honourable Ramkalawan expressed concerns over delays in payments and the number of applicants who have been rejected for the scheme, seeking clarifications as to the administrative procedure for the scheme.
“A sum of R1,090,531,200 (billion) was approved in the revised 2020 budget, which was approved two weeks later than scheduled. The sum was to be managed by a committee with high-ranking government officials and representatives of the private sector,” Minister Loustau-Lalanne explained.
According to Minister Loustau-Lalanne, until Monday May 4, the ministry had received 4,065 applications and of those, 1,192 were considered and 103 have been paid at a sum of R6.1 million. As of Monday May 4, 444 letters had already been finalised, the sum of which will be published in a first report for the month of April, which is to be prepared soon and presented to the Assembly.
With regards to delays, Minister Loustau-Lalanne attributed this to numerous factors including the lockdown which resulted in the submission for applications being prolonged until May 8 (for payments for the month of April). There were also many cases whereby requested documents were not submitted, he said, assuring the assembly that the first report detailing the number of applications, statistics and figures will be prepared in due time.
He revealed the largest pay-out thus far has been to a hotel establishment at a sum of R3.7 million and the smallest pay-out, to self-employed individuals not holding a bank account or unable to prove their income prior to the pandemic, is based on the minimum wage at R5804. Thus far, the committee has received applications from different categories of businesses, including hairdresser, three taxi drivers who were paid on Wednesday April 29, tour guides, guesthouses, professional services, omnibus operators, car hires, fisheries-related, optometry, specialist clinic, take-aways, pest control, boat charter and driving instructors among others.
Highlighting unemployment statistics and the strain on the committee and services including the Agency for Social Protection (ASP) which manages and disburses social welfare benefits, Minister Loustau-Lalanne said the unemployed count for the first three months, was, on average 223 persons but as for April, this has increased six fold to bring the total to 1,370 persons who are eligible for unemployment benefits, to a value of R3 million. Under Dedicated Fund, the school programme, R7 million has been disbursed thus far and a further R4.765 million as additional allowance for home carers, for continued service even through the period for which the prohibition on movement was enforced.
The FA4JR committee has been publicising how many applications have been lodged, how many have been approved and how much has been paid out on a daily basis, Minister Loustau-Lalanne assured the assembly. As per the employment laws, employers are required to make salary payments no later than the fifth day after the end of the month, although Minister Loustau-Lalanne assured that payments for the month of April should be issued by May 13.
“The application process for the month of April is open to May 8 and applicants have to be mindful of the 10 and 15-day processing period which applies to each category of applications before receiving a letter or communication approving or rejecting their applications.
“Not many applications have been rejected but the majority are those who failed to provide the requested documents and who do not hold a bank account. The R3.7 million for the large hotel, the committee has made a deduction of R600,000 on salaries as when they submitted the payroll, it was inclusive of employees who are not in the country. Self-assessment may have been quicker but leaves more room for abuses,” the minister said, asserting the necessity to be prudent so as to stretch the billion rupee budget, which provides for salary payments until September.
Honourable Ahmed Afif and Honourable Jean-François Ferrari both expressed concerns as to alleged claims of businesses who have not been adversely impacted, benefitting from pay-outs.
Minister Loustau-Lalanne added that the committee is prioritising taxi drivers and clarified that a wholesale retail business involved in manufacturing baby products from textiles, has benefitted with the minimum payment on April 29.
SS Payet clarified that some businesses that have benefitted from pay-outs for the month of April may not necessarily qualify for payments in May or June, on account that businesses are now operational after restrictions on movement and shutdown on some categories of businesses were lifted on Monday.
As for the R30,000 salary cap, SS Payet noted no intention to lower the cap as analysis indicates that persons earning over the cap tend to be self-employed individuals with large loans with commercial banks among other financial obligations.
Honourable Sebastien Pillay, member of United Seychelles (US), proposed that the committee be more forthcoming with information so as to avoid confusing the public or misunderstandings.
Minister Loustau-Lalanne concluded the session by making mention of the delay in approving the budget after members of the LDS party walked out of the assembly against a motion to forego the second reading of the budget bill.
SS Payet on his part said the rejected applications are referred to the department of employment, also noting an appeals process for rejected applicants.