Wednesday, 23 July 2014

Budget vote speech - Trade & Industry

Speech by Toby Chance MP
DTI budget vote
Old Assembly Chamber
22nd July 2014

South Africa below SADC neighbours on entrepreneurship

Chairperson, Honourable Members and visitors in the gallery, good evening, sanibonani, goeie naand.

The Honourable members on the other side of the House like telling stories. So let me tell a story of my own. And thank you, Honourable Bhengu, for providing such a perfect introduction for me.

For many South Africans, the formation of the Department of Small Business Development is a fairy tale come true.

And in all fairy tales there are heroes as well as villains.

 Will the heroine be the new Minister, the Honourable Lindiwe Zulu? Perhaps so, if she casts herself in the role of Cinderella.

As Cinderella, she can shake off the shackles of her two ugly sisters, the Departments of Trade and Industry and Economic Development, which for the past five years have been a grave disappointment in creating opportunities for small business.

Like Drizella and Anastasia with their big feet and unwieldy frames, they have been slow to move and have presented the disagreeable face of the ANC government to small business.

Now small businesses   have an opportunity to emerge from their shadows and be nimble of foot.

I have made it clear to the Honourable Minister that I will adopted a constructive approach to the Department and in Committee work.

So let me take my analogy a step further by saying I am willing and ready to play the role of Prince Charming opposite Minister Zulu’s Cinderalla.

You see Chairperson, the DA has the experience and finesse to fit the slipper of enterprise and opportunity onto the Honourable Minister's delicate foot.

Instead of the clumsiness displayed by her sister the DTI, the new ministry has an opportunity to tread boldly along the path of small business development.

Her inheritance is mixed. On the report scorecard we might say, good intentions, short on delivery.

To paraphrase Winston Churchill, the Honourable Davies would have us believe he is a very modest man. Indeed, he has a lot to be modest about.

The FinScope Small Business Survey found that only 4% of small businesses had heard of the DTI’s flagship small business support agency, Seda.

Seda, by its own admission, had to refocus its strategy after years of mediocre performance. We will be scrutinising it closely in the coming years and expect a dramatic improvement.

We need a massive upscaling of support for small business and cooperatives in South Africa. Brazil, for example, has over 400 business incubators. The DTI's target is 250 but it has not yet set a date for when these will be operational.

Nearly two years after the Incubator Support Programme was announced, reportedly only 8 are up and running of which only 2 have received the promised funding. That is just not good enough.

Perhaps the most urgent priority for Minister Zulu is to lead the creation of an entrepreneurial ecosystem in South Africa. The Global Entrepreneurship Monitor 2014 report, arguably the most authoritative of its kind, ranks South Africa below our SADC neighbours and other emerging economies in all the major markers of entrepreneurship. In South Africa, it is more attractive and lucrative to get a comfy job in government than to start a business. 

This has to change, for the country to create the jobs we so desperately need.

By rigorously pursuing the strategy outlined in the NDP, the Department of Small Business Development can reduce the cost of doing business, make it easier to hire and fire employees, boost local procurement and greatly expand instruments for financing and marketing small businesses and cooperatives. This includes implementing the latest recommendations of the Davis Tax Committee.

On the issue of local procurement, let this be interpreted to mean not just South African products but those produced by small and informal township and rural enterprises for local retail and wholesale outlets.

If the Honourable Zulu sticks to this plan, we can make history by voting in unison on the new department's budget later this year. I look forward to constructive engagements in the coming months with that end in mind.

But please, Minister: no more flirting with the National Democratic Revolution. This is the ugliest sister of them all.


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