Deputy Minister of Trade and Industry, Bongi Maria Ntuli's address to the National Council of Provinces

Chairperson
Minister Rob Davies
Deputy Minister Thandi Tobias-Pokolo
Members of the Provincial Executive Committees
Permanent delegates to the National Council of Provinces
Honourable Members
Heads of Provincial Economic Departments
Ladies and gentlemen

Honourable Chairperson, despite my advancing years I am one of the two "new kids on the block," in the Ministry collective of the Department of Trade and Industry. However my association with the dti stretches back several years as a member of the Portfolio Committee.

I am therefore fortunate to have some insight into the challenges that face this huge department whose primary role is 'to promote employment and equity through economic growth within a developmental state". As the ANC, we will make no apologies for this.

This is the mandate endorsed by the majority of the electorate in April 2009 when we were returned as the governing party for the next five years. If this is our mandate it therefore stands to reason that we must increase the pace and quality of delivery to our communities in order to realise our goals of creating decent work and sustainable livelihoods.

I am pleased to note that the enterprise organisation, the division at the dti that deals with grants and other incentive schemes has an increased allocation in the current budget. The rationale for this is that expenditure on incentive schemes for small and medium enterprises will increase and my wish is that it does significantly.

Chairperson, this is a good sign and indicates that the development of small enterprises remains one of our top priorities. In the same light the South African Micro Finance Apex Fund has had an increase in budget. This is the fund that assists vulnerable communities mainly in the rural areas.

Honourable Members, our budget shows impressive figures of businesses assisted by our agencies like Small Enterprise Development Agency (Seda), Khula, the National Empowerment Fund (NEF) etc. While I acknowledge the role of our agencies and divisions in assisting communities, we dare not "claim easy victories" and will not "tell lies" about our achievements.

The reality is that we are not always getting value for the money spent and we have not successfully measured the impact of our programmes on the lives of the most vulnerable. We need to monitor our spending patterns much more closely and here I would appeal to the select committee to exercise their oversight role, robustly if necessary. It is the members from this chamber who are closest to their communities via their provincial responsibilities and who I expect to confront us, as the dti with the realities.

Continue to be our moral compass and re-direct us where necessary to the path of economic upliftment and empowerment of your constituencies, particularly women and the youth. On the matter of provinces I have committed to meeting all the nine MECs to gauge what programmes they would prioritise for those who currently are operating outside of the mainstream economy. I also asked the MECs to form better partnerships with us in order to enhance each others work and prevent duplication.

So far I have met the MECs of Gauteng and the Western Cape and will complete all meetings before the end of July. I must say what I have heard so far has given me considerable hope that "together we will do more".

Chairperson, we cannot escape the fact that we present the budget against the backdrop of an economic crisis, that has and will continue to affect all of us. Therefore the matter of resources will always be an issue, so we have to look at creative ways to make our budget stretch. One of those I mentioned earlier was asking our provincial colleagues to partner with us in joint programmes.

Well, last night I opened our national Cooperatives Mega Expo and Conference in Pietermaritzburg. The event will be till Saturday 4 July and will be attended by 500 co-operatives from all over South Africa. The Economic Development department of KwaZulu Natal together with the municipalities of Umsunduzi and Umgungundlovu generously co-financed this event with the dti.

Sincere thanks to Premier Mhkize, MEC Mabuyakhulu and the Mayors of the two municipalities for their visionary thinking. Other provinces also provided logistical support to co-operatives from their regions making it able for them to attend the event.

Of course we would like to see the private sector partnering us in these initiatives; maybe my next round of meetings after the MECs should be with the CEOs! In this way we are trying to co-ordinate our work better and also free up resources that can practically and materially benefit co-operatives and other small enterprises. We also need to grow the number of registered co-operatives since besides the 17 000 registered coops there are more than 800 000 informal structures like stokvels, burial societies and savings clubs.

As we know many of these informal savings societies and buying clubs are in the rural and peri-urban areas and the membership largely has women as their members, I'm sure like me there are Honourable Members of this House who also are members of such clubs.

Chairperson I aim to intensify the work started by my predecessor, The Honourable Elizabeth Thabethe, in making sure that communities know what it is that the dti can offer those who want to start or grow their businesses. My focus will be on rural, peri-urban mainly women and youth formations. This as always will be done in conjunction with our provincial departments and local government counterparts. We will also explore the possibility of public-private partnerships for these events.

As regards enterprise development, our experience has taught us that key challenges facing small, medium and micro enterprises (SMMEs) include managerial skills, access to finance, technological expertise and the overall capacity to deliver products and services to the market.

We will strengthen our response to these challenges through the further rollout of the integrated small business strategy. This strategy is aimed at supporting small enterprise development through a matrix of programmes guided by five key strategic areas of intervention.

In short these are:

* The first strategic area of intervention focuses on improving access to business support information.
* The second strategic area of our interventions will focus on increasing access to business finance, particularly micro and small enterprise finance.
* The third strategic area of intervention is in creating opportunities that provide small businesses access to markets.
* The fourth strategic area focuses on forging partnerships for the establishment of business support infrastructure.
* The fifth intervention will focus on creating an enabling regulatory environment for the development and growth of SMMEs.

The details related to these five strategic areas are well documented in the dti Medium Term Strategic Framework for 2009 to 2012.

Honourable Members, next year our country will host one of the world's premier sporting events, the FIFA Soccer World Cup. Our small business entrepreneurs must benefit from these and other global events staged by our country. The implementation of the five aforementioned interventions must be fast tracked especially the one regarding access to finance.

In this regard I am pleased with the move by Khula to provide direct lending to the 'under-serviced' market for amounts between R10 000 and R250 000. But please, Khula watch the interest that you will be charging, keep it as close to the repo rate as possible or Governor Mboweni will have to investigate you as well!

As regards our programmes for the economic empowerment of women I am disappointed that we have not managed to increase the budget for the work of the South African Women Entrepreneurs Network (SAWEN) significantly but I'm sure with discussions we can be creative in making our resources stretch. SAWEN remains the primary organisation for women owned, mainly small, enterprises to access dti services. We will increase our focus to assist women in rural areas.

We will look at partnerships with Provinces as well as the private sector to increase our reach as regards to training programmes for women entrepreneurs. We need to massify the "Ba Vumile" programme. The focus of the initiative is to upgrade the skills of women through training interventions to enable them to produce commercially competitive products for both the local and international markets. The pilot project was successful in four provinces.

Honourable Members, our communities, those who gave us the overwhelming mandate, do not want to know how well we know this budget; they want to know if we care enough to use the budget to make a meaningful change to their lives. We are all the custodians of this budget; we are all collectively responsible for its success or its failure to address the developmental challenges of our country. Our communities given the correct support are more than able to assist us in this process.

Nobel Peace Prize laureate, founder of the Grameen Bank and the guest speaker at the next Nelson Mandela lecture on 11 July this year, Professor Muhammad Yunus said, "People can change their own lives, provided they have the right kind of institutional support. They're not asking for charity, charity is no solution to poverty."

I wish to thank Minister Davies for his inspired leadership and Deputy Minister Tobias-Pokolo for her support. Thank you to Minister Patel and Deputy Minister Mahlangu-Nkabinde who I know I can call on for their unique insight into economic development issues. Also thank you to the staff of the Ministry for helping me to literally, 'hit the ground running' in this new role I have been tasked with.

I thank you.

Issued by: Department of Trade and Industry
3 July 2009
Source: Department of Trade and Industry (http://www.dti.gov.za)

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