Navigating Market Access for Small Businesses
Meeting Summary
The Portfolio Committee on Small Business Development met to discuss market access opportunities for small, medium, and micro enterprises (SMMEs) and co-operatives, as well as the project structure for the appointment of the Ombudsperson for Small Enterprises.
The Committee content advisor explained the importance of the small business sector in contributing to economic growth and creating jobs, and indicated how poorly South Africa compared to other countries in Africa and around the world. Common challenges stifling the growth of this sector included access to markets, access to finance, bureaucratic obstacles, and access to business premises.
In the discussion, the Chairperson raised concerns about spaza shops that operate illegally, live on their trading premises, sell unhealthy food on credit, and take advantage of those reliant on South African Social Security Agency (SASSA) grants. If these shops operated legally, they would be bound to the rules and regulations of the country, but the lack of enforcement meant that South Africans remained in poverty and could not participate in the opportunities afforded to them to start their own small businesses, and grow and develop.
Committee Members raised various concerns relating to improving access to opportunities for SMMEs, particularly in the farming sector, where there was an urgent need for assistance in building market and storage facilities to prevent losses from weather-related issues. They referred to the dominance of large retailers in township areas, who undermine small businesses by offering low prices and thereby create unmanageable competition.
Members emphasised the need for a supportive framework to foster inclusive economic growth. SMMEs should be assisted through the promotion of professional conduct, similar to businesses in other countries. They advocated continuous financial education for SMMEs to ensure their sustainability, job creation, and market readiness. Other concerns were the inappropriate regulations affecting SMMEs, particularly those owned by black individuals, women, youth, and people with disabilities, and the need for the government to provide better market access and support. Overall, the discussion called for a comprehensive strategy to empower SMMEs and address systemic obstacles to their growth.
Meeting report
The Chairperson said the purpose of the meeting was to continue the Portfolio Committee's sessions aimed at assisting community members who need the Committee’s help. She encouraged Committee Members to raise any concerns they may have.
Third term programme
After dealing with apologies and adopting the agenda, Members were asked to consider and adopt the updated 2024 third term Committee programme, following the recent changes made to it.
Mr H Kruger (DA) expressed his support for the programme, which was also endorsed by Ms L Sapo (ANC).
Mr C Malematja (ANC) asked where the proposal for visiting Gauteng was being included.
Mr King Kunene, the Committee secretary, responded that it was not part of the programme because it had emerged after the programme had been drafted. However, based on the Committee's discussions, it would be added as an emergency oversight visit. He said that an application still needed to be submitted for approval by the House Chairperson.
The Chairperson affirmed Mr Kunene's statement and asked Mr Malematja if he found this acceptable.
Mr Malematja replied that he was satisfied with the explanation provided, and endorsed the adoption of the programme.
Improving market access opportunities for SMMEs and co-operatives
Mr Sibusiso Gumede, Committee Content Advisor, outlined the structure of the presentation, and said that it served as a precursor to the strategic plan that the Department would provide in April 2025. This plan would also include the annual performance plan (APP) for 2025/26. The presentation was intended to guide the Members on the key areas of interest within the sector. He encouraged them to engage with entrepreneurs and inquire about which issues most significantly impacted their businesses. He indicated that common challenges were likely to include access to markets, access to finance, bureaucratic obstacles, and access to business premises. In his presentation, he would focus on the specific interests of small, medium and micro enterprises (SMMEs) and co-operatives.
He said that according to global trends, the SMME sector had been steadily expanding and had recently emerged as the largest employer in both the developed and developing worlds. Further, research demonstrated that in the Organisation for Economic Cooperation and Development (OECD) area, SMMEs represented almost the totality of the business population, accounting for about 70% of employment and generating between 50% and 60% of the value added to the economy. In Africa, this sector formed the backbone of most countries’ economies, representing more than 90% of businesses and employing more than 60% of workers, many of whom were women and youths.
Closer to home, the scenario was very different in South Africa, where SMMEs were facing stagnation in both employment growth and turnover. The sector’s contribution to total output was minimal compared to South Africa’s peers, such as Kenya, Brazil, Rwanda, and India, to mention a few.
Challenges the sector was facing included:
- Constrained and limited access to the market for SMMEs and co-operatives was one of the key barriers to South Africa’s attempts at growing the small enterprise sector.
- The sector was generally unaware of what standards they had to comply with, and how to implement them. Rural and township enterprises, especially, had no support mechanisms to guide them through standardised principles.
- Adopting these standards was also very costly and implementation was arduous, which negatively affected the extent to which small enterprises could participate in the complete value chains.
- Inflexible and exorbitant requirements, such as those imposed by the Construction and Industry Development Board (CIDB), the Hazard Analysis and Critical Control Points (HACCP), International Standards Organisation (ISO), organic content certification, ethnic/religious requirements -- Halal (Muslim) or Kosher (Jewish) -- and experience and financial capability, were still being used perversely to eliminate small enterprises from acquiring huge and lucrative contracts.
- The complexity of sustainability standards was preventing small enterprises from accessing the market, both private and public.
- Market structure and contractual agreements also played a role in hindering the small enterprise sector from moving forward.
- Such exclusionary practices were prevalent, especially in the profitable sectors of the economy, through irrational contracts, pricing strategies and, more commonly, actions taken by dominant firms to deter new competitors from entering an industry, forcing competitors to exit the industry, confining competitors in their own little corner, and/or to prevent them from expanding – really a source of market concentration.
Mr Gumede said South Africa had one of the highest SMME failure rates globally. Ms Catherine Wijnberg, founder and the Chief Executive Officer (CEO) of Fetola, had concluded at some point that, “In our experience as a business growth agency, the most common reason is that many businesses are simply not yet market ready. While there is often a desire to onboard a big client, in reality, the business may not be in a position to service that client.”
A 2017 study by the Small Business Institute (SBI) revealed that 70% of emerging small businesses failed within the first two years of operation. The same study had revealed that while 98.5% of the country’s economy was made up of SMMEs, they delivered only 28% of all employment opportunities.
There were very few instruments in existence to induce or compel the private sector from playing its part. For instance, the transformation sector charters were non-binding instruments. Other key sectors of the economy did not have such charters -- a wholesale or retail charter, for example --yet the sector lagged behind in its transformation endeavours. However, neighbouring Namibia had this charter, and SA retailers like Spar were obliged to conform to the charter.
The revised broad-based black economic empowerment (BBBEE) code placed a great deal of focus on enterprise and supplier development (ESD). There was a growing number of private incubators and accelerators, many of which were being established in response to ESD and BBBEE solely for compliance purposes, and were therefore adding little value to the entire small enterprise ecosystem.
Current structures in the retail and wholesale sector that support informal and small enterprise businesses appeared to be inadequate in supporting new business start-ups, their long-term growth, and sustainability. The barriers and facilitators to growth and sustainability needed to be clearly understood to drive economic growth within this sector.
Poor economic infrastructure was among the biggest hurdles facing the country’s ambitious program to improve the nation's manufacturing capabilities and support higher growth for generating employment. Power generation and transmission remained a hotly contested issue, while transportation infrastructure capacity constraints continued to limit small enterprise performance and private sector investments. This was particularly the case with rural and township enterprises.
South Africa did not have a single overarching piece of public procurement legislation, and this led to fragmentation. There were a host of laws governing national, provincial and local governments which govern procurement, such as the Public Finance Management Act (PFMA), the Financial Management of Parliament Act (FMPA) and the Municipal Finance Management Act (MFMA).
Mr Gumede pointed out that in South Africa, one did not find these small enterprises and small-holder/small-scale farmers, and even if one did, they did not have the capacity and capability to supply according to the requirements (see Annexure A, Pick n Pay supplier requirements). Those with potential, were risky and unreliable suppliers, and did not have the financial muscle to compete. The local role was to procure for internal customers and not to develop suppliers. There was no benefit derived by buying from small-scale suppliers.
The international picture was very different.
In the United Kingdom, small businesses were of much greater benefit to local communities than large firms. For every £1 spent with a small or medium-sized business, 63p was re-spent in the local area, compared to 40p in every £1 spent with a larger business.
In the United States, minority business firms were being established and growing and employing minorities at a faster rate than other sectors of the population. Doing business with small and minority businesses was advantageous, due to their being agile and adaptable. They had to be more innovative in order to compete with more established players. They were more in touch with community needs and purchasing trends, thereby liberating new market opportunities, and they were more customer-focused and service-orientated
Potential opportunities for SMMEs in the private sector
The objective of this section was merely to underscore the significance of private sector procurement because, whenever a subject of access to market was brought to the fore, attention was often and exclusively directed to the state as a procurer of goods and services, yet the private sector was double or triple the size of a state sector. The approach needed was therefore to highlight the role that the private sector could potentially play through their enterprise and supplier development (ESD) activities.
The Committee was shown the results of the listed general retail groups:
The Spar Group:
This was one of the well-established retail corporations in SA. It was headquartered in Durban, operates in nine countries, has ten distribution centres and serves 3 768 retail members through 14 store formats every day. The Spar turnover had increased from R71 billion in 2023, to R77 billion in 2024. Like Pep stores, Spar's national footprint was without comparison.
The Shoprite Group:
This was the largest South African retailer by market capitalisation, sales, profit, number of employees and customers. The Group's revenue had climbed from R215 billion in 2023, to R240 billion in 2024.
The Woolworths Group:
Woolworths was a South African-based company and operated 1 594 store locations in 14 countries. The group’s revenue reached R76 billion in 2024, from R73 billion in 2023. The Woolies Food division remained the crown jewel of the group.
Massmart:
This company comprises four divisions operating in 436 stores, in 13 sub-Saharan African countries. The Group recorded total sales of R89 billion, from R85 billion 2023. It owned most of the leading wholesalers in the country, which in turn supply small contractors under various state programmes such as the Department of Basic Education's (DBE's) National School Nutrition Programme (NSNP), the Department of Social Development's (DSD's) social relief of distress (SRD) grant, and the Departments of Health, Defence and/or Correctional Services, to name the few, and this was where most spaza shops and general dealers stock their products.
The Pick n Pay Group:
This retailer trades under two main brands – Pick n Pay and Boxer. The first four Pick n Pay stores opened in Cape Town in 1967. Today, the Group has 2 227 stores across South Africa, Botswana, Eswatini, Lesotho, Namibia, Nigeria, Zambia and Zimbabwe. It had registered R112 billion in revenues, from R106 billion the previous year, and had recorded R74 billion in 2024, while Boxer had achieved R37 billion, from R31 billion the previous year. Boxer had been acquired by Pick n Pay in 2002. As of October, it had expanded into 308 superstores, 162 liquor stores and 30 build stores across South Africa and Eswatini, giving a Group a total of 500 stores. They opened their 500th Boxer store in Port Shepstone on 24 October, with more to be added to the Boxer stable later in the year. Several informative entrepreneurial presentations have been held throughout the year, allowing potential suppliers the opportunity to enhance their efforts and knowledge ahead of their attempts to engage and form deals with Boxer.
Potential opportunities for SMMEs in the public sector
- Over the medium term, total consolidated spending was expected to increase nominally, from R2.4 trillion in 2024/25, to R2.6 trillion in 2026/27. It was expected that the bulk of the spending would be allocated to learning and culture, social development, health and community development.
- The Committee considers public procurement as a critical lever to change the production and ownership of the economy to empower black people, people living with disabilities, women and the youth.
- The Committee welcomes the signing of the Public Procurement Bill into law, and was particularly pleased with inclusion of sections 17 and 18, which deal with ‘set asides’.
Social Development
- The South African Social Security Agency (SASSA) was paying grants to over 26 million people. A total of R252 billion was made available to SASSA for the payment of social grants between April 2023 and March 2024, with monthly payments averaging R20 to R21 billion.
Education
- The National Treasury reported that learning and culture would be allocated R465 billion in 2024/25, R486 billion in 2025/26 and R508 billion in 2026/27. The net increase in the function’s baseline was R21.4 billion (1.5 per cent) over the medium term expenditure framework (MTEF) period, from R1.4 trillion to R1.5 trillion.
Correctional Services
- The Department of Correctional Services' allocation for 2024/25 financial year amounted to R87 billion, which was expected to increase to R30 billion in 2026/27.
Conclusion
The importance of the small enterprise sector was increasingly being recognised in many countries, including South Africa, after many years of market domination by large enterprises. Current structures in the retail and wholesale sector that support informal and small businesses appear to be inadequate in supporting new business start-ups, their long-term growth, and sustainability.
The barriers and facilitators to growth and sustainability needed to be clearly understood to drive economic growth within this sector. The participation of the small enterprise sector was still low, judging from the market share and overall contribution to gross domestic product (GDP). However, numerous initiatives were now being taken to redress past discrimination and improve the market environment, with interventions such as the Grocery Retail and Market Inquiry commissioned by the Competition Commission.
Recommendations
- On the private sector front, a number of interventions, such as lobbying the industry, the Wholesale and Retail Sector Education and Training Authority (W&RSETA), and other key players, to develop a charter may be considered.
- Further, safe and reliable distribution centres that meet the retailers' food packaging and handling requirements, as well as Department of Health's (DoH's) food safety requirements, were vital in meeting the private sector demands. The creation of districts with shared multi-purpose distribution centres (MPDCs) could be explored jointly by the Departments of Agriculture, Forestry and Fisheries and the Environment, Basic Education, Correctional Services, Rural Development, Health and Small Business Development.
- The Department must consider having a structured approach and engagement with National Treasury that would cover a spectrum of issues. The Department and National Treasury should craft an implementable strategy to reduce market concentration, including the possible introduction of quotas -- for example, for every R1 spent by the state on a big corporation, 40 cents must go to a SMME or co-operative.
- The non-payment of services providers, small enterprises in particular, was not only rampant in the state environment, but in the private sector as well. Stricter measures must be developed to reign in and ensure private sector accountability.
- The propositions being made here were not out of the ordinary, but in line with the rationale behind the creation of this Department - to advance the development of sustainable SMMEs and co-operatives as key levers for job creation and the reduction of poverty and inequality; with a specific focus on youth, women and people with disabilities, especially in rural areas and townships; as well as high-growth businesses with the potential to be catapulted to the centre of the mainstream economy, to disrupt the concentration and structure of the economy.
[See attached for the full presentation]
Discussion
Ms B Mathulelwa (EFF) started by referring to markets, and said that she missed the comments regarding her concerns about overseas issues. Secondly, she was concerned about improving immediate access to opportunities for SMME co-operatives, as mentioned by the content advisor. She said that the presentation touched on most aspects and emphasised that during their public hearings across the country last year, they heard other perspectives on the market issue, particularly from SMMEs in the Eastern Cape. They had highlighted that they were based in a farming environment, and were requesting that the Department help them to build a market and storage facilities for their products. This was crucial to avoid losses due to weather conditions, since they operated outdoors. She said that fruit and vegetables were especially affected by sun and windy weather, leading to spoilage. She also addressed the processing infrastructure to enable entrepreneurs to process their products.
Regarding the Business Amendment Bill that the Minister had mentioned, it was important to note that this Bill did not currently exist and was not even in its foundational stages after three years of waiting. She expressed her frustration, as this was critical because big businesses posed challenges for smaller businesses. She made an example of companies like ShopRite, Pick n Pay, and Spar, which not only occupied township areas but also encroached on the territory of small businesses. They sold items starting from 50 cents to R1, making it difficult for small businesses to compete.
She suggested that big businesses should not be allowed to dominate the market in this way. When they sell products such as rice in bulk and in small quantities, they create competition that small businesses cannot match. They therefore had to intervene and implement measures to level the playing field. Access to markets was a significant problem, and big businesses could not continue to operate unchecked in this manner.
Ms M Mmolotsane (ANC) said that during the 6th administration meeting, it was noted that there had been a meeting with the CEOs of Spar and Shoprite. She would like to know the status of the process discussed at that meeting, and inquired about the possibility of having a similar meeting with the other two store managers. She stressed the importance of addressing the challenges local businesses face in acquiring space and bringing them to the location, especially given the many red tape obstacles that hinder their progress. For someone not experienced in the business, establishing a store could be quite challenging.
She asked if it would be possible to arrange the same meeting again to discuss what needed to be done for these locations, which should ideally be owned by local property owners. She also highlighted the need for these shops to procure fresh produce from local SMMEs. She cited a previous project, where a municipality had funded an agricultural co-operative with support from SASOL. The individuals involved faced marketing challenges, as local stores like Shoprite and Spar often required products to be packaged in specific ways that local SMMEs could not afford.
Mr C Malematja (ANC) said that the presentation had been very informative, and as Committee Members, they should adopt and draw recommendations from it in order to provide the proper assistance to the SMMEs. He pointed out that the main economic policy goal of the government was to provide a framework where inclusive growth was accelerated. He agreed with Mr Gumede regarding the challenges mentioned in the presentation that the SMMEs were facing. However, he felt that, in many cases, these challenges were used as obstacles and not necessarily opportunities to grow. His main concern was that to achieve success with SMMEs, one should acknowledge the respect afforded to similar businesses in other countries. These businesses treat themselves professionally, and could compete effectively in their economies. While the outreach program by the Committee and the Department was important, he believed that a single visit was not sufficient.
He said that continuously providing financial education to the SMMEs was a strategy to help them grow into larger businesses, and that the focus should not be solely on the growth of SMMEs, but also on assisting with job creation and ensuring the sustainability of these enterprises. Opportunities for emerging entrepreneurs should not be overlooked, as the current market seems closed for them. For instance, in Port Elizabeth, some individuals repeatedly received assistance but had seen little growth in their businesses after three years. This stagnation may block younger entrepreneurs who are eager to bring in new initiatives. From the presentation, it was evident that ongoing financial education should be prioritised to ensure SMMEs are sustainable and able to compete effectively. SMMEs should develop financial independence beyond government assistance. Nowadays, the competition is less about physical confrontation and more about mastering market dynamics.
He suggested that the focus should be on ensuring that SMMEs within the townships were market-ready, enabling them to grow and become preferred producers. Financial assistance alone would not be helpful if these businesses did not meet market demands. He also raised questions about the reasons for stagnation in turnover and employment growth among small businesses in South Africa. Lastly, he inquired why SA lacks binding instruments through the transformation sector charter for retailers, unlike Namibia, where such measures contribute significantly to the development of small businesses.
Ms C Mafagane (MK) highlighted concerns regarding the inadequate regulations affecting the growth of SMMEs in the country, particularly those owned by black individuals, women, youth and people living with disabilities. These regulations, and limited market access, were key barriers for co-operatives and the broader sector. Complex sustainability standards further hindered small businesses from accessing both private and public markets. She believed that the Department of Small Business Development (DSBD) should serve as a bridge to help SMMEs to access funding and market opportunities. However, she felt that its actions did not reflect this intent, as there appeared to be a lack of willpower to support black entrepreneurs. Unfortunately, many were left in the difficult circumstances in which they had started.
She said the country had recently faced embarrassment due to incidents involving foreign-owned small businesses and "spaza shops" disregarding local bylaws, safety regulations and compliance requirements, but continued to thrive. She argued that the Department should facilitate easier market access for black South Africans, but this was not happening, which was concerning. Major companies like Spar and Pick n Pay received bailouts year after year, whereas similar support was not extended to black SMMEs and enterprises. She questioned who the Committee was serving, pointing out that while it received commendable reports annually, they did not align with the realities on the ground or the current youth unemployment rate.
Ms S Singh (DA) agreed that the presentation served as a high-level report, and was taking the Committee in a specific direction. While she agreed with many points, she also had serious concerns and wanted to clarify the actual responsibilities of the Department. She believed it should nurture entrepreneurs and support SMMEs until they become sustainable. She herself came from an SMME background, and expressed her passion for supporting these businesses, clarifying that she was not present to defend large corporations.
She said that once the DSBD effectively guides SMMEs, these businesses may collaborate if it aligned with their interests. Her primary concerns focused on ensuring that SMMEs could become viable and sustainable. She emphasised that no business could survive in a protected environment indefinitely -- this approach was unsustainable in the current global economy, where cheaper imports could undercut local businesses, like Shein and Temu. It was therefore crucial to equip businesses to be innovative and responsive to consumer needs to avoid the recent incident at a “spaza shop,” where pesticides had been used.
She voiced specific concerns regarding the stringent requirements, such as International Standards Organisation (ISO) certifications and regulatory compliance in various industries, including construction. While these standards were necessary to prevent issues like building collapses or safety hazards, the costs associated with obtaining such certifications could be prohibitive for small businesses.
Ms Singh recounted her experience in a small business, highlighting how ISO standards had helped them continuously improve their product quality. While she agreed that entrepreneurs should not be burdened with costs related to documentation, she cautioned against implementing a one-size-fits-all approach. Each situation should be evaluated individually to avoid blanket policies that may not meet varying needs. Moreover, when discussing the eligibility criteria for municipalities and other entities, it was essential to consider the broader community costs. Disparities in payments could affect the entire community, and ultimately, the burden was passed on to consumers, regardless of the business size. Overall, she called for careful evaluation of the Department's policies and their implications, advocating a balanced approach that fosters entrepreneurship while ensuring community well-being.
Ms L Ngobeni (Action SA) said she appreciated the remarks made by Ms Singh, and was of the view that people speak of SMMEs as if they were in a universe that they do not exist in. The profile of the SMMEs included the spaza shop economy, as they had seen. They had been under attack in the last couple of weeks, and she felt that this could not be left unchecked or undiscussed by this Committee. She wanted to know what the Department's plan was, because there was outrage in communities around the lack of opportunity to be able to begin and be capacitated enough to at least be operational. The Committee was mute in this regard, and it was spoken about as if these SMMEs were not actually real people working on the ground, and faced with these issues.
Mr V Zungula (ANC) referred to the issue of the business inspectors in the previous administration, and the Minister's commitment that there would be business inspectors who would ensure the compliance of companies in the small business sector with the applicable legislation. He felt that in the light of what was happening in the country, where there was food poisoning across the board, it would be wise to take this issue up with the Minister or the Department.
The presentation had indicated what was happening in the Department of Employment and Labour, where the labour inspectors visit companies to ensure compliance with labour laws. However, when it came to the SMME sector, it was completely unregulated, and even though there were laws, there were no proper mechanisms to ensure compliance. For instance, when one went to areas in Gauteng, many businesses were operating on a cash basis and did not pay tax, and the revenue that could have been collected could have been used to fund the SMMEs. When it came to enforcing compliance, what was the Department doing in this regard?
Ms D Ntshaba (MK) spoke in the vernacular, and no translation was provided.
Responses
The Chairperson handed over the content advisor to respond to the questions and concerns raised by the Committee Members.
Mr Gumede thanked the Members for their questions and their supportive statements. He reiterated that the purpose of the presentation was to stimulate discussions and prepare the Members for what would be presented to Parliament by the DSBD. He noted that the issues raised were fragmented and scattered. He therefore suggested the need for a cohesive strategy that incorporates all these issues and consolidates them into a comprehensive plan to be driven by the Department. He said that during the fifth administration, there had been a half-hearted attempt by the DSBD to develop a similar strategy, but it had ultimately fallen through.
He said a market access strategy was essential to address the challenges SMMEs, co-operatives, and spaza shops faced. He emphasised that while the recommendations made by Committee Members were valuable, they remained suggestions. It was through the Committee that these recommendations could be presented to the Department for implementation. He also mentioned that he looked at the situation both horizontally and vertically, analysing it physically while considering the vast amount of SMME data in the agricultural sector, which had its specific requirements
Mr Gumede said that various entities in the retail sector would fall under the Committee's general scope. Each of these entities required a specific response from the Department. When the most common issues were considered, particularly in rural areas, one of the recommendations was to focus on a product from the Department’s shared economic infrastructure facility. This was a programme that existed within the DSBD. He said it was important to rethink how this programme was packaged to address the issues being raised, such as the need for storage facilities. The storage facility was a key concern, especially for fresh produce. There were also needs for processing facilities -- he could point to examples related to distribution that indicated a requirement for additional support.
He said it was the responsibility of the Committee to ensure that when these documents were presented to the Department, they forcefully advocated for adequate funding to address these concerns. He used an example of looking at 44 district municipalities to illustrate how development could be approached, perhaps by establishing a facility that addresses issues in one district, such as those related to livestock. Ultimately, these initiatives must meet the requirements that had been stipulated.
He highlighted that the complaints of the SMMEs about supply issues could not be ignored. It was essential to ensure that products meet the retailers' standards. Moreover, there was a significant lag in legislation from the Department, which had been present for a decade but had made little progress. He mentioned that only one piece of legislation had been referred to Parliament during the fifth administration. There was a need to prioritise inspections of shops and follow up on recommendations with the Minister. It was also crucial to engage with the CEOs of various retailers, not just Spar or Shoprite, to understand what support the Department could provide. This engagement could lead to improved market strategies and address the overall issues facing the industry. The Committee should push for collaboration with the Regional Working Committee (RWC) and the Department of Trade, Industry and Competition (DTIC) to promote transformation and development, adding that transformation needed to be prioritised more effectively.
He suggested that the Department of Social Development (SSD) should prioritise assisting people living with disabilities and ensure they receive grants from the South African Social Security Agency (SASSA). The presentation emphasised the importance of aligning key performance targets with the issues faced by the Department. Some people, like those in their own businesses, could benefit from the R370 Social Relief of Distress (SRD) grants. The Department should also follow up with the Minister on recommendations made during the previous term involving inspectors and enforcing the bylaws of municipalities.
Lastly, Mr Gumede suggested a method to address information and property issues, focusing on social development. He would follow up with a colleague from the DSD to provide details, and address similar challenges. He was more than willing to share his contact information with their Committee to follow up. If questions were not answered, the support staff would provide recommendations and hold meetings to discuss the enforcement of bylaws. This strategy was part of a strategy to follow up with the Minister on social development matters.
Further discussion
The Chairperson addressed the issue of spaza shops, highlighting the concerning practice where owners bathe and sleep at their trading premises, while also allowing the community to consume the food being sold there. She noted that these products were often sold on credit, to be paid for when individuals received their SASSA grant. This situation deprived these people of the opportunity to improve their circumstances, leaving them stuck in poverty, and the food sold to them was unhealthy.
Mr Malematja stressed that it was important to remember that the discussion revolved around small business development, which was a general concept rather than a specific one. He said that when the SMMEs face bureaucratic delays, it becomes the responsibility of the Committee to ensure that this process is handled correctly. He suggested arranging a debate to ensure that the current and future SMMEs receive the proper assistance to operate as legitimate businesses, similar to bank branches. Currently, these enterprises face significant challenges due to red tape that hinders their formal establishment. Many SMMEs, particularly among the black community, struggled to break into other sectors due to these barriers. In the future, the Committee has to address this issue. If they do not treat these businesses as SMMEs, they risk encountering problems similar to those faced by spaza shops, which start small but could grow into larger enterprises. He emphasised that he did not want this issue to be overlooked, as many of the same individuals involved in illegal trading could benefit from support to become legal businesses.
The Chairperson said that if spaza shops were operating legally, they would be bound by the rules and would not be able to act freely. She pointed out that nowadays, when one visits a spaza shop and requests a loan of R100, the following month, when it is time to repay it, one is charged R90 extra -- with a SASSA grant as an income. This issue arose because many shops were not registered. She acknowledged the advice given, and expressed her belief that they would be able to assist.
She thanked Mr Gumede for his presentation, commending him for always going the extra mile to gather content, and encouraged him to maintain his excellent work.
Mr Gumede said that this presentation had focused on market access, and there would be another presentation on access to finance that would be presented to the Committee in due course. There would also be a presentation on the ease of doing business and addressing red tape. If time permitted, they would also look into issues related to premises and infrastructure. It was important to note that some of these topics may overlap, as they fell under different categories. He encouraged Committee Members to share any specific subjects of interest that they would like investigated or researched. The Committee was welcome to reach out to him, or the researcher, and they would be happy to come back and present their findings to the Committee.
Appointment of Ombudsperson for Small Enterprises
Mr King Kunene, the Committee Secretary, said that the purpose of this discussion was to inform the Members about the structure and processes involved in appointing an Ombudsperson for Small Enterprises. He said the following should be included in the programme:
- Briefing on the matter by the legal advisor or content advisor. (1 day)
- Consideration and adoption of the programme for the appointment of the Ombudsperson. (1 day)
- Preparation of an advert -- translation, sourcing of quotes, applying for approval. (2 weeks)
- Advertising in print media. (4 weeks).
- Shortlisting of candidates on applications received. (1 to 2 days)
- Screening of CVs of shortlisted candidates through the South African Police Services and Parliamentary Protection Services. (2 weeks)
- Conducting of interviews. (2 days)
- Deliberations on candidates. (1 day)
- Consideration and adoption of the report. (1 day)
This was the structure that would be followed and the duration of the process for the appointment of an Ombudsperson.
The Chairperson thanked Mr Kunene and suggested that he email the document regarding the procedure for the appointment of the Ombudsperson to all the Committee Members. She asked the Members whether they had any questions relating to the presentation.
Mr B Luthuli (IFP) said that he only had one question, which was regarding the time they were expected to start.
Ms Mathulelwa was also concerned about the time frame of the appointment of the Ombudsperson, as this had been raised as a matter of emergency due to the many cases involved. She referred to a pending case that was in the telecommunication sector, and also many other cases which she thought the Committee would be briefed on. She also referred to two cases in the Northern Cape, and wanted clarity on when these cases were going to be dealt with. She was raising this as a concern, because presenting this without a time frame would not assist the Members.
Ms Sapo felt that issues were being mixed up. She assumed that on 13 November, the Committee would consider the adoption of the programme for the appointment of the Ombudsperson, and suggested that the Members should wait until then for an answer regarding the timeframe.
The Chairperson agreed with Ms Sapo regarding the timeframes and said that the Committee Members would get an opportunity to voice their concerns.
Committee minutes
Committee minutes dated 23 October
Ms Mathulelwa said that she wanted the minutes to reflect that the EFF and MK rejected the report, instead of stating that they reserved their rights.
Mr Kunene explained that they did not write the Committee reports verbatim, hence it was stated in the closing remarks that “they reserved their rights.”
The minutes were adopted.
The meeting was adjourned.
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Present
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Dikgale, Ms MC Chairperson
ANC -
Kruger, Mr HC
DA -
Luthuli, Mr BN
IFP -
Mafagane, Ms MC
MK -
Malematja, Mr C N
ANC -
Mathulelwa, Ms B
EFF -
Mmolotsane, Ms ML
ANC -
Ngobeni, Ms LM
Action SA -
Ntshaba, Ms D
MK -
Sapo, Ms L
ANC -
Singh, Ms S
DA -
Webster, Ms NL
BOSA -
Zungula, Mr V
ATM
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