Remarks by the Minister of Small Business Development, Ms Lindiwe Zulu, at the closing event to the National Imbizo Focus Week, Imbizo Lounge, Tshedimosetso House
The Imbizo week has once again reinforced the idea that direct and unmediated interaction between the government and its citizens is at the heart of democratic governance. The Imbizo programme gives concrete expression to the Freedom Charter clause: The people shall government!
Imbizo affords ordinary citizens to evaluate the performance of government and share with elected leaders their views on the pace, direction and quality of service delivery. It is critical that, in keeping with the spirit of participatory democracy, inputs that emerge through the Imbizo platform be incorporated in the strategic plans of government departments.
Our people keep reminding us that governance cannot be a technical process that operates outside the views and aspirations of government’s key stakeholders – citizens.
Throughout the izimbizo programme, people express appreciation of the progress made by government to improve their lives. Understandably, this appreciation is expressed alongside concerns at the pace and quality of service delivery.
During this week, I had the pleasure to host an Imbizo of women in co-operatives and small businesses in Bela Bela, Limpopo. I interacted with people who clearly took government’s message of vukuzenzele to heart. In their articulation of issues, it was clear that they refuse to be passive recipients of service delivery. They want to seize the opportunities brought by our democracy and to become their own liberators.
Participants at our imbizo programme urged us to pay attention to the following, among other things:
- Procurement opportunities for local co-operatives and small businesses
- Corruption relating to procurement
- Information relating to incentives and support to small businesses and co-operatives
- Economic empowerment and business opportunities for people with disabilities
- Availing economic opportunities to ex-offenders as part of reintegrating them into society
- Skills development
- Access to land
Government needs to muster the discipline of structured and institutionalised feedback mechanism to communities and stakeholders who raised the issues. Indeed, inadequate account for implementation of imbizo commitments has the potential of undermining the credibility of this noble philosophy of governance. It can lead to communities losing confidence in the ability of government to positively address their concerns. Unless government responds directly to issues raised by our people, then the imbizo will not be what it was meant to be, and the objective of making ours a truly participatory democracy shall not have been advanced.
As this time-tested platform of popular participation moves forward, government must find ways of responding faster to the people’s immediate concerns. We need to ensure that imbizo is not dismissed as a mere public relations exercise with no practical meaning in the lives of ordinary citizens.
One of the key observations I made is that our people want access to information that would enable them to take advantage of the opportunities that have been availed by our democratic government. It is clear that access to information remains a critical challenge. Many people are not aware of critical programmes, services and opportunities that are meant to assist their small businesses and co-operatives.
It is sad and tragic that many of our people had not been reached by the information that could help them and their communities to begin to break out of cycles of poverty and desperation.
In this regard, my department will deploy requisite resources in the area of marketing and communication so that the services we provide become accessible to our people.
I have also observed convergence between the aspirations of our people and government priorities. People raise challenges pertinent to their lives, challenges that government itself has identified as critical in building a country where all must benefit. They confirm their confidence in government’s ability to address their plight and in particular in the effectiveness of imbizo as a catalyst for improved performance by government.
Communities across the country see imbizo as a platform for effective interaction with government. They see imbizo as a trusted forum because it brings the executive into direct interaction with them. The people have confidence that the issues they raise would focus the attention of government on their needs.
Imbizo has highlighted challenges faced by our systems of governance generally. Our people have reminded us that they see government as one. They do not differentiate between spheres or institutions of government. They expect us to work as one seamless machine in a co-ordinated and integrated way. They do not want to be sent from pillar to post when they seek information or services.
The Imbizo Focus Week was a platform for government and the people to jointly find solutions to the triple challenges that confront our society (namely, poverty, unemployment and inequality) and to give content to the notion of radical economic transformation.
During his recent State of the Nation Address, President Jacob Zuma announced a nine point plan to accelerate economic growth and create jobs. The points are as follows:
- Resolving the energy challenges;
- Revitalising agriculture and the agro-processing value chain;
- Advancing beneficiation or adding value to our mineral wealth;
- More effective implementation of a higher impact Industrial Policy Action Plan;
- Encouraging private sector investment;
- Moderating workplace conflict;
- Unlocking the potential of small, medium and micro enterprises (SMMEs), cooperatives, township and rural enterprises;
- State reform and boosting the role of state owned companies, information and communications technology (ICT) infrastructure or broadband roll-out, water, sanitation and transport infrastructure; and
- Operation Phakisa on the ocean economy which aimed at unlocking opportunities in the shipping, fisheries, aquaculture, mining, oil and gas, bio-technology and tourism sectors.
The National Development Plan is the vehicle which will address poverty, unemployment and inequality. It sets an ambitious aim to treble the size of the economy by 2030, a daunting challenge that will require our collective contribution. Meeting the NDP’s growth target of 5.4 % for the next 16 years would not only guarantee South Africa’s material prosperity, but would be an elevating and inspiring narrative for the country – ‘an optimistic new story’, as the NDP phrases it.
As the NDP makes clear, getting South Africa onto a high-growth trajectory demands that we fundamentally change our game plan and place small businesses and co-operatives at the centre of our war against poverty, inequality and unemployment. Developing a strong and growing SME community is a cornerstone of the NDP’s vision. SMEs are expected to be central to South Africa’s job creation efforts, in line with international trends. According to the National Development Plan, about 90% of jobs will be created through small and expanding companies by 2030.
The revitalisation of SMMEs, Co-operatives, townships and rural enterprises are critical in developing an inclusive economy and boosting job creation. The small business and co-operative sector faces constraints in growing and sustaining their enterprises as a result of lack of business opportunities in both the public and private sectors. SMMEs and Co-operatives are overlooked in both sectors as they are viewed as lacking experience and expertise. SMMEs and Co-operatives do not access procurement opportunities because of perceived poor quality of products, lack of capacity to produce big volumes and turnaround time in the delivery of goods and services.
Government proposes to mitigate these challenge through increasing procurement from SMMEs, Co-operatives, rural enterprises, township enterprises and small holder farmers, with a target of 30% set asides for designated categories of state procurement. National Treasury will issue the Practice Notes to all spheres of government to implement the set-asides programme. 30% of government goods and services should be procured from SMME’s and Co-operatives
The Department of Small Business Development will enter into transversal agreements with other government departments and state agencies because government recognises that all government departments and agencies have something to offer to small businesses. The implementation of the public procurement programme, esp. the set-asides, will ensure an increased contribution to the GDP, sustainable livelihoods and creation of job opportunities by the small business sector. It is envisaged that these SMMEs and Co-operatives will be drawn from previously disadvantaged areas.
Access to finance is another major obstacle to the development and growth of small businesses and co-operatives. Migration of the Small Enterprise Finance Agency to the Department of Small Business Development will ensure a more integrated approach towards extending support to SMMEs and co-operatives. The department will also develop a business rescue strategy aimed at supporting SMMEs and Co-operatives in financial distress and a framework to strengthen and regulate the informal business sector.
Government also recognizes that need to review the policy and regulatory environment that hinder the development, growth and competitiveness of small businesses. All the spheres of government should institutionalise the guidelines aimed at reducing red tape at local government level. We will work with local government on the review of by-laws affecting SMMEs and Co-operatives.
Government is aware that small businesses and co-operatives find it difficult to flourish in underdeveloped areas such as townships and rural communities due to lack of adequate investments in infrastructure and lack of appropriate policies to protect informal businesses. More resources and investments aimed at building infrastructure and upgrades in the townships and rural areas will mean that enterprises in these areas will have a meaningful contribution to the overall economy in terms of reducing poverty and the creation of new sustainable jobs. Informal businesses will be sustainable and some will graduate to become micro and small businesses.
I am therefore pleased to be part of this interactive session which serves as the closing event for the Imbizo Focus Week. I hope we will all take advantage of this opportunity bring forth ideas that will take South Africa forward.
