A new ministry for small business? Now we are getting somewhere. Perhaps.
ANC Secretary General Gwede Mantashe has floated the idea of a new ministry for small business in the government to be formed after the May elections. Under the headline "Mantashe stokes hopes for small business ministry", Business Day reported Mantashe raising the matter at a SA Chamber of Commerce and Industry business breakfast in Johannesburg. This follows his first mention of the idea back in February. If the ANC is serious, the question then is, can they make the new ministry effective?
Small business development is a highly vexed issue that goes hand in hand with job creation, clearly South Africa's most important economic imperative. Without the first, the argument goes, we do not get the second, because large companies are unlikely to create many new jobs and the government payroll is already bloated. All the political parties have made small business development a major plank of their manifestos but the DA has gone into the most detail with ten pages of recommendations contained in our economic policy document.
Mantashe gave an inkling of why an ANC-run small business ministry will face an uphill struggle by mentioning cadre deployment when outlining the potential of municipalities to support small business. Mantashe and his ANC comrades cannot escape their fixation with appointing party loyalists to key jobs, vastly reducing the pool of potential candidates.
Let's examine what a ministry for small business would look like. First, it would need a minister and probably two deputy ministers. Where are they to come from, but from elected ANC MPs? Judging from Jacob Zuma's appointment of Rob Davies and Ebrahim Patel, both die-hard communists, as ministers of trade and industry and economic development in his current administration, we might despair of seeing worthier candidates for the new ministry. Are there any likely ANC MPs who have the business experience to be able to understand, and empathise with the people their ministry is meant to assist?
Then the ministry would have to be staffed up, we would expect with capable and business-savvy (with a nod to Nedbank's Eugene) professionals experienced in the world of business. What is the track record of departments and agencies tasked with small business development? Pretty dire. For example the Small Business Development Agency, SEDA, and the Gauteng Enterprise Propeller, GEP, have spent most of their allocated budgets on salaries and overheads rather than assisting small businesses in tangible ways. They are staffed in the main by bureaucrats with little or no understanding of business, so how can you expect them to perform?