Government cuts red tape to help small business

Cape Town – Government has sent guidelines on reducing red tape to various municipalities in a bid to make it easier for small businesses to succeed, Minister Gugile Nkwinti said on Tuesday.

“The roll out of red tape reduction guidelines [was] conducted in 30 municipalities. The department has secured a partnership with the International Labour Organisation on monitoring the implementation of municipal red tape reduction guidelines in four piloted municipalities situated in the Free State and KwaZulu-Natal,” said the Minister.

He was speaking during the Economic Sectors, Employment and Infrastructure Development cluster media briefing in Cape Town on Tuesday.

The Guidelines for the Reduction of Municipal Red Tape are aimed at improving the survival rate of small business and contributing to the levelling of the business playing field.

They are based on the recognition that small businesses in South Africa are suffering from excessive red tape, a challenge experienced by business both at provincial and national level.

The guidelines serve as a practical implementation framework to reduce local government or municipal red tape in support of SMMEs.

Red tape can be defined as rules, regulations and bureaucratic procedures that are excessively complex and which impose unnecessary delays, inaction and costs that exceed their benefits. Red tape further has undesirable economic, business or social impacts.

The purpose of the guidelines is to provide municipalities and businesses with practical tools and resources to address municipal red tape issues which have the potential to improve the business environment for small businesses.

On Tuesday, the Minister said further support to SMMEs, including women-owned enterprises, has been provided in the form of incentives, incubation and business support to ensure that the sector thrives.

Meanwhile, Minister Nkwinti said the potential exists for SMMEs to grow across the Nine-Point Plan through various programmes. This includes the Cooperatives Incentive Scheme, which the Minister said was making an impact.

Nineteen youth enterprises and 52 women-owned enterprises were supported through the Cooperatives Incentive Scheme.

“In addition, 65 women-owned enterprises were supported through the Black Business Supplier Development Programme. The Department [of Small Business Development] has revised the guidelines of the Shared Economic Infrastructure Facility in order to attract municipalities and to make the programme more accessible to its potential beneficiaries,” he said.

The Minister said in September 2015, government launched the National Gazelles Programme, a multi-stakeholder platform that seeks to provide dedicated high level support services to 40 high potential SMMEs, with the aim of serving as ambassadors of the small enterprise sector.

Twenty cooperatives in Gauteng, Mpumalanga, North West and KZN are participating in the South African Breweries (SAB) Women in Maize programme.

The Minister commended the private sector for supporting this programme.

“The programme aims to empower women-owned cooperatives that are farming in maize and to increase the inclusion of black women-owned cooperatives in SAB’s supply chain; develop skills of women farmers; improve food security; and stimulate local economies by increasing procurement from local suppliers.

“One hundred and thirty-six primary cooperatives received training on management, governance and bookkeeping.

“In addition, 14 cooperatives and SMMEs were funded and exposed to market opportunities. Ninety-three cooperatives have been approved for funding.”

The Minister said the department facilitated market access to 230 craft enterprises and 144 craft enterprises were provided with product development support. A further 102 craft enterprises participated in enterprise development programmes.