Committee Report on Small Business Development budget

Small Business Development

19 May 2015
Chairperson: Ms R Bhengu (ANC)
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Meeting Summary

The Committee considered its report on budget vote 31, Department of Small Business Development. After noting grammatical, spelling and wording issues through the report, Members discussed certain observations and recommendations for further clarity, added some additional observations and recommendations as well as removing some.

The report was adopted with amendments. The DA reserved its rights. 

Meeting report

Committee Report on Department of Small Business Development Budget Vote

The Chairperson said the secretariat had made changes to the report since the Committee last went through it.

Mr T Ramokhoase (ANC) did not think two hours were enough to go through matters of substance in the report.

Rev K Meshoe (ACDP) thought it might be helpful to just go through where the changes were made.

The secretary noted that most of the changes were made in the observations and recommendations section of the report.

Members then went through this section by themselves. Thereafter the Chairperson invited comments from Members.

Mr X Mabasa (ANC) suggested the Committee took the report page by page at a fast pace.

Mr R Chance (DA) noted that he did not get a chance to go through the report page by page since changes had been effected since the last time the Committee went through the report and he did not have that version with him to track the changes. He only went through the observations and recommendations section.

Rev Meshoe thought it was unnecessary to go through the entire report since it was discussed last week. The Committee should just go to the observations and recommendations.

The Chairperson did not know if that was possible because changes were effected in the presence of Members. It would have helped if Members brought their old copies to track the changes.

Mr H Kruger (DA) trusted that the Committee staff effected the inputs correctly since the Committee last met to deal with the report. Members should go straight to the observations and recommendations.

The Chairperson said it was not a matter of trusting the staff – amendments were made in the presence of Members last week. The Committee would go through the observations of the report first.

Mr Mabasa highlighted grammatical errors elsewhere in the report – this showed the secretariat overlooked some minor amendments. It only took one mistake for the report to be ridiculed.

The Chairperson thought it helped when someone who did not write the report read it otherwise what was written, even if there were mistakes, would make sense in the mind of the author.

Mr Chance took issue with point number 8, under observations, he could not remember the Committee observing it and thought SEFA did talk to micro-enterprises.

The Chairperson noted the discussion highlighted that SEFA was outsourcing this function to intermediaries who were then charging. 

Mr Chance suggested the point be rephrased then to talk to direct loans.  

The Chairperson highlighted that it was not just about loans and the point spoke to this so it was best to leave it as it was unless there was a dispute about it. She drew the Committee’s attention to point number 20. This observation was made before the Acting DG explained the matter to the Committee. Either the point should be paraphrased or taken out. It was important for anyone reading the document to have the same understanding the Committee did.

Mr Kruger suggested gazelle be added to the list of definitions the Committee used for future discussion. 

Mr S Bekwa (ANC) proposed the point in question be removed.

Mr Ramokhoase noted a definition for upper end SMMEs was also needed. 

Mr Mncwabe (NFP) requested to be excused because he was debating in the House in a few minutes. The NFP supported the adoption of the report with amendments. 

Mr Ramokhoase thought point 20 was a valid one in terms of the Committee’s observations as to who graduated and who was a starter SMME.

Mr Chance suggested some alternative wording. He was concerned that there was no recommendation relating to this observation when the Committee had one during the discussion at the time.

The Chairperson felt it was still important to define gazelle for a person reading the report who might not be au fait with it.

Mr Chance suggested that there should be a definition for “upper end” as well.

Turning to recommendations, Mr Chance thought point number one should be reworded because, in its current state, it implied more funds should be provided. He provided alternative wording.

Mr Mabasa questioned whether there should be an addition to the end of point number 25 of the observations, because it was “hanging” in its current form.

The Chairperson explained why the point was acceptable in its current form.

Mr Kruger felt it was best the points just reflected the principle of the discussions without adding detailed examples. It was important to ensure the Committee fixed these principles within its four years.

Mr Chance, after highlighting some grammatical errors, questioned what the 1% was in reference to – profits? Turnover? Asset value?

Mr King Kunene, Committee Secretary, remembered the Committee discussed it as a resolution during a meeting but he was not sure exactly what the 1% referred to.

Mr Chance thought this was too ambiguous and suggested the 1% be removed.

Mr Mabasa, after highlighting grammatical errors, proposed an additional recommendation to cover informal traders not supported. There should be an entity to register these informal businesses because, although it suited them not to be known, this was to their own detriment. It was the challenge of making informal businesses known.

A member of the Committee staff noted that survivalists were dealt with under the recommendations

Mr Mabasa thought the point would get lost this way or it would not be able to be tracked.

Mr Kruger thought a strategy was needed to formalise businesses. 

The Chairperson felt it was important not to come across as wanting to restrict these informal businesses. The point should come across with the aim of providing assistance and adequate support.

Mr Kruger said it was not a very new concept using the example of formalising the taxi industry so there was a blueprint on the matter.

The Chairperson was not disputing this but the point should include a provision to outline support services and incentives. 

Rev Meshoe added that it was important to capture thought on red tape, as a number of informal business owners were illiterate so they were scared of filling in complicated forms.

Mr Ramokhoase thought the emphasis should be on strengthening through collaboration in municipalities.

The Chairperson heard the Member refer to making services more accessible by being located in municipalities. She also heard Mr Kruger refer to the development of a strategy to formalise informal businesses, simply support services and make them easily accessible.

Mr Ramokhoase agreed. 

Mr Kruger noted that the issue of red tape was somewhat addressed in point number 20 but the sentence did not make sense and it needed to be rewritten.

A member of the Committee staff explained the point further.

Mr Kruger said red tape was not limited to a specific level of government so this should be made clear.

Mr Mabasa thought the recommendations or observations should cover vulnerable groups. 

Mr Kruger noted the Committee never discussed that point and observations the Committee did not discuss could not be inserted.

Mr Chance suggested alternative wording for point number 23 under the recommendations.

The report was adopted with amendments, the DA reserving its right.

The meeting was adjourned.


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