Community Safety
(a) What impact has the ban on the sale of alcohol had on the programmes of Western Cape Liquor Authority and (b) what mitigation measures have been put in place?
The Western Cape Liquor Authority (WCLA) informed me as follows:
9 (a) and (b) FINANCE
The resources budgeted to be mobilized by the Western Cape Liquor Authority (WCLA) on behalf of the Provincial Revenue Fund will be affected by the economic impact of the lockdown and the resultant ban on the sale of alcohol.
The demand for alcohol is relatively inelastic which will help lessen the long-term impact of the lockdown on license holders. However, there will be a short-term economic impact of the lockdown. It is assumed that 6.4% of the licences will lapse as a result of the lockdown in line with the National Treasury economic predictions.
The preliminary lockdown impact on the self-sustainability of the WCLA is projected as follows under the difference scenarios of the 2020 fee increases:
The above analysis assumes that the allocation to the WCLA will not be further reduced considering the reductions that came into effect when the 2020 MTEF budget was approved.
The extent of the impact on applications for events and temporary licences as well as new licenses is expected to be far greater than the general impact on the economy. Accordingly, the impact on own revenue is expected to be in line with the long recovery scenario presented by National Treasury.
Accordingly, the WCLA is projected to lose approximately R3.1 million in licencing revenue which includes application and licence issuing fees, over the period of the National State of Disaster due to the lockdown and limitations placed on event and temporal licences during the various Alert levels. This is expected to be mitigated by a projected increase of R1.2 million in fines issued by the Liquor Licensing Tribunal (LLT) due to violation of lockdown regulations by license holders who allegedly sold alcohol during the lockdown. The projected net decrease in own revenue is expected to be R1.9 million or 16.1% of budgeted own revenue.
A comprehensive analysis of the expenditure budget was undertaken and projected savings to the total value of R1.3 million were identified. The WCLA has a projected deficit of R0.6 million. The deficit may be covered by the projected surplus from the 2019/20 financial year, subject to review.
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9 (a) and (b) LIQUOR LICENSING ADMINISTRATION AND TRIBUNAL
Under alert level 4 and 5 of the lockdown, the processing of applications and the issuing of licences by the Liquor Licensing Tribunal (LLT) was limited. Due to this, the operations of the WCLA did not allow the inspectorate to focus on inspections at newly issued licenses. Such premises would have been unable to operate, and the relevant indicator did not really apply during the Lockdown period. Subsequently under Alert Level 3 normal processing, consideration and issuing of outcomes resumed.
9 (a) and (b) COMPLIANCE AND ENFORCEMENT
At the start of the Lockdown which commenced on 26th of March 2020, the Compliance and Enforcement Component of the WCLA developed Standard Operating Procedures, which were specifically aimed at the monitoring of provincial license holders in terms of compliance with the National Lockdown Regulations.
Although normal routine inspections were not possible, Inspectors were required to visit licensed outlets daily to ensure that no liquor sales were allowed. The Inspectors mostly relied on complaints from the public and other law enforcement agencies to investigate contraventions in terms of the Lockdown Regulations. Such contraventions were regarded as an imminent threat to the health, well-being and safety of the public and such matters were referred to the LLT for purposes of the temporary suspension of these licenses. To date a total of 37 licenses were suspended as an interim measure leading up to the finalization of such matters for purposes of imposing proper sanctions.
These contraventions have posed a challenge as the LLT is only empowered to consider contraventions in terms of the Western Cape Liquor Act of 2008. Some licenses do contain conditions which requires licensees to comply with other liquor related legislation and it was therefore possible to consider such matters in terms of the provision which criminalizes the failure to comply with such conditions. A further option was to consider whether the relevant licensees are still fit to hold licenses on the basis that the contravention of the Lockdown Regulations is regarded as serious. Most of these cases are still pending before the LLT. A total of 117 investigations were conducted by the inspectorate during the lockdown.
The ban on alcohol sales has had a huge impact on the performance of the component in terms of certain Annual Performance Indicators which includes the “Number of new licensed outlets inspected within 12 months after date of issue” and “the number of inspections focussed on the sale of alcohol to children”.
Although Inspectors were able to monitor the sale of liquor to children at premises that might have contravened the Lockdown Regulations, such activities are normally most prevalent at on-consumption outlets and such premises have since the start of Lockdown, not been able to serve liquor for consumption on these premises. The purpose and aim of the relevant indicator have therefore been defeated to a certain extent.
The current Annual Performance Plan of the WCLA may be reviewed to amend the Performance Indicators to speak more to current circumstances.
Inspectors were further able to focus on reports related to new and secondary applications which were submitted prior to the start of Lockdown. However, these functions were also hampered to a certain extent due to businesses being closed. They were only able to collect information which was accessible at the time.
