Dear President Cyril Ramaphosa

Once again we (the nation) find our ourselves waiting with bated breath to hear your State of the Nation address that entails plans and promises to fix our social malaise that our beloved country finds itself in. In the same vein, noting your Presidential terms of both your organisation and in government has been marred with much “volatility” that has not been seen since the advent of democracy in our country. I’m however leaning on the positive side that the efforts of your government will prevail even though time is against you since its election year.

Mr President, as you are drafting your speech, I felt I should contribute through this opinion piece as part of a building block to the social fabric of our country. In this regard, allow me then Mr. President to remind you on government undertakings on SMME’s matters to date.

Speaking on the said matter you had this to say, “we have worked to facilitate investment by increasing the ease of doing business, including by making it easier to start a business.” As it is your “wont” you went on a charm offensive with regards to SMME matters and further said “in the past year ( 2020 ), more than 125,000 new companies have been registered through the “Bizportal platform,” completing their registration in just a matter of hours from the comfort of their homes or offices.”

Mr President, while all what you had mentioned is commendable, I’m however deeply worried if that’s the barometer by which you measure “entrepreneurial activity” in our country then we are in big trouble. This creates false hope that when people have Pty Certificates, they are in business whereas they are just compliant.

It’s also sad to learn that your economic cluster departments are not complementing one another Mr President. Just to remind you that at your disposal you have the following departments in no order of preference Dept of Trade and Industry, Dept of Economic Development, Dept of Small Business and Development and the “cherry on top being” Presidential Economic Advisory Council. All these mentioned departments are not working in tandem with each other, there’s no correlation at all. Of great concern is the fact that respective provinces are doing their own thing that is not in line with the “innocuous” and soon to be obsolete National Integrated Small Entrepreneurship Intergraded Strategy.

To further amplify the point I’m trying to illustrate Mr President, all provinces have their provincial economic departments that are adorned with “Schedule D” provincial agencies e.g. Eastern Cape Development Cooperation (ECDC), Gauteng Enterprise Propeller ( GEP) , Limpompo Development Agency (Limpdev) to mention just a few.

To a person who’s watching from a far, this means that the centre is not holding as each province does as it deems fit when it comes to SMME matters. All these agencies I’ve mentioned are not singing from the same hymn sheet of the national government.

In 2023 while delivering State of the Nation Address you had this to say Mr. President –“Last year I announced that we would be seeking to reduce red tape so that we can rid our country of the unnecessary bureaucracy that often holds us back. The red tape reduction team in the Presidency under Mr. Sipho Nkosi has been working with various departments to make it easier to do business.

This year, we will finalise amendments to the Businesses Act to reduce regulatory impediments for SMMEs and cooperatives and make it easier for entrepreneurs to start businesses. Through the Small Enterprise Finance Agency – SEFA – we plan to provide R1.4 billion in financing to over 90,000 entrepreneurs. Government in partnership with the SA SME Fund is working to establish a R10 billion fund to support SMME growth.

Government is looking at the possibility of providing R2.5 billion for the fund and for the balance of R7.5 billion to be raised from the private sector. The licensing of the Post Bank will lay the foundation for the creation of a state bank that will provide financial services to SMMEs, youth- and women-owned businesses and underserved communities”.

I’m sure Mr. President you’ll agree with me that nothing has happened of all of the above undertakings. To be frank and honest with you that train of Mr. Nkosi never left the station.

To date Mr. President, SMME’s in South Africa have never heard nor seen the efforts of Mr. Nkosi in terms of curbing red tape of doing business with government. SMME’s in South Africa are still subjected to a litany of red tapes that are impeding their growth in order for them to compete with established businesses. To put it aptly Mr. President, in “biological terms” your government is behaving like a “semi permeable membrane that allows certain molecules to pass through.”

Just to give you a living example, a group of women who decide to open their own security company, in order to qualify for a business opportunity they must produce a bank guarantee letter yet amongst them they have 10 years of experience. A funding opportunity for SMME’s always has red tape requires audited financials even though one is a startup or the SMME must have 3 years experience in the industry.

I submit to you Mr President that our SMME’s are tired of being subjected to trainings by your agencies NYDA, Seda and their ilk. We are products of our parents who were “illiterate hawkers” and were not exposed to all these pseudo trainings that are designed to make agencies look good on their scorecard and cajole attendees with catering.

Perhaps Mr. President as you reconfigure your departments for the next administration please add on the to do list the discussion of the existence of this animal called Dept of Small Business (DSBD) which has always had “teething problems since it was born.”

I’m raising this matter about the existence of the (DSBD) in light of it not having a clear mandate of its existence that can be embraced by the small business owners of this country. I have never seen a department that competes with its own implementing agencies namely, Small Enterprise Finance Agency (Sefa) and Small Enterprise Development Agency (Seda). In a perfect world “DSBD” is supposed to play a role of catalyst role for the effective running of its agencies but “lo behold” that’s not the case but is instead running programmes like its agencies.

To crown it all, in this day and age we can’t have a department that always does pitch competitions where one person will walk away with a lump sum. In my province Eastern Cape I don’t know how many cooperatives have been given tractors and implements by government yet there’s no output from those efforts.

Mr President, I submit to you that the problems that beset our entrepreneurs are “endemic and systematic” and chief amongst them is red tape, access to financial and non-financial services, elimination of black people through stringent requirements, non-effective regulatory agencies i.e. CIDB , Patronage to mention just a few.

I’ve been sounding a lone drum saying the mooted merger of Seda and Sefa and the “eclipsing” of the “National Integrated Small Entrepreneurship Intergraded Strategy” in favour of on the National Integrated Small Enterprise Development (Nised) will further blow the plight of SMME’s into smithereens.

Policy researcher Mr. Luthando Nondaba puts frankly in his critique of this animal called “Nised”, he writes? “The Nised master plan alleges to harness an integrated and well-functioning ecosystem that mobilises all role-players into a seamless and streamlined solution for the development and support of small enterprises – whatever that means. I could not have agreed more with Luthando”.

The overarching objective of the Nised master plan is to significantly raise the contribution of economic output and labour absorption by SMMEs.

It purports to achieve this by a series of programmes and actions within outcome areas, namely:

-A well-informed South Africa on SMMEs with continuous monitoring, evaluation and learning;

-Policy, laws and regulations reformed to enable SMME growth and efficient governance;

-Effective targeted support and services delivered for SMME growth both financial and non-financial; and

-Co-ordinated government with strengthened private-sector partnerships for SMME growth.

The remaining quandary is the question of „how‟? I submit to you Mr. President that the above matters of Nised cannot be realised while your “Economic Advisory Council” is not decisive or coming up with people centered policies.

As a solution to this “vexatious” matter I propose that there should be uniformity in South Africa irrespective which province you are based in with one database for all SMME’s of South Africa, give SMME’s funding kits that are not redeemable for cash to start businesses, revise industry compliance bodies e.g. CIDB, CIPC, create a state bank for purchase order funding with 5 days turnaround time, abolish red tape in whatever form. In doing so Mr. President you would be “ameliorating” that status quos of unemployment in our country.

Once again poet laureate Mazisi Kunene speaks from the grave in his epic work on the “Rise of Shaka” pertaining our situation as SMME’s, he said, “Those who feast on the grounds of others often are forced into gestures of friendship they do not desire. But we are the generation that cannot be bypassed. We shall not be blinded by gifts from feasts. With our own fire we shall stand above the mountains, as the sun.”

Xola Moni is a Director of a Consulting Agency