Small businesses continue to get bad service from government departments - a case study

This week I received an impassioned email from the owner of a small business who had applied for funding from Sefa but got nothing but the proverbial run around. Our correspondence and his submission to the Portfolio Committee on Small Business Development, copied below, describe his frustrations at the failure of the Department, its agencies and other government departments to do their job.

I have kept the identity of the individual he is complaining about at Sefa confidential as it would not be fair on her to reveal her name until Sefa has investigated the complaint.

25/03/18
>
>  ATTENTION: Portfolio Committee on Small Business
>
>  RE: Submission of A Complaint & A Request To Address The Committe on This
> Issue
>
>  This is a submission of a Complaint to the Portfolio Committee on
>  Small Business Development, about SEFA and one of its employees called
>  xxxxxxxx.
>
>  I submitted a Loan application with SEFA on the 10 January 2018, for an
>  amount of R4 875 000, for a Township specific, online Media Outlet, called
>  Street Beat Media based in Mandela Bay, and since then I've been given
>  an aimless, silly run around by this xxxxxxxx, let alone the
>  fact that I've had to ask her to acknowledge receipt of my
>  application, she or should I say SEFA is not at all interested in a
>  fair processing of my application, despite the fact that I provided
>  them with a comprehensive Business Plan.
>
>  Find attached with this more information on this application
>
>  Looking forward to hearing from you soon
>
>  Jwarha Mali
>  Publisher
>

A
SUBMISSION TO THE PORTFOLIO COMMITTEE ON SMALL BUSINESS

Heading: A COMPLAINT AGAINST SEFA’s xxxxxxxx

From: Jwarha M. Mali

Contact Details: 073 584 7046  / jojorha@gmail.com

Purpose of This Submission: To Appear Before The Committee 

Date: 25/03/18

The Background

On Wednesday, 10 January 2018, at around 14h00, I took my Loan Application for R4 875 000, to the SEFA offices based in Cape Road, Mandela Bay. On delivering this Business Plan, I asked to speak to the Branch manager and was told he/she was not around (I didn’t believe this), but then I’ve over the years learnt to deal with unresponsive, inefficient and incompetent bureaucrats, I obliged, though reluctantly.

I asked the young woman taking my application, who was going to handle my application, and she told me that it was xxxxxxxxx, and asked for her email.        

The mandatory seven days passed without this xxxxxxxxx or SEFA acknowledging receipt of my application. And then on the 17 January I wrote xxxxxxxxx asking her to acknowledge receipt of my application. (NOTE: I’m begging to be acknowledged here . .  . .)  

Finally, she negatively acknowledged me, telling me that, (1) I was listed by one Van der Linde Trust, and that in both my, (2) business and (3) personal accounts I gave them 3 months statements, instead of 6 months statements (I considered this 3/6 months statement the most bizarre, silly and lamest excuse I ever heard). Both accounts were new, at just around 3 months then. 

The Van der Linde Trust, she claimed I owed is based in Roodepoort, and I rented office space with them for around R2 000 per month back in 2009. It is also worth mentioning that before I moved in to that office space I made it very clear to the owner, Mr. Len Van der Linde, that Street Beat Media, my business was battling and he allowed me to move in despite, and I moved out after about six months after it became clear that I couldn’t secure ads to pay for my rentals, and in all these instances I communicated my intentions to the
landlord.   

I consider the Van der Linde Trust listing illegal, and went ahead and reported

it with the National Consumer Council, the Credit Ombud, and the Department ofSmall Business, and in all these instances I sent xxxxxxxxx copies. 

Entrepreneurs and Entrepreneurship in South Africa

It is a well recorded fact that the operating environment in South Africa is hostile towards entrepreneurs and entrepreneurship, particularly Black entrepreneurs, added to that is a plethora of unfriendly regulations, policies and the barriers created to access capital.
 

This situation is particularly alarming in a context where South Africa has such a huge gap 
between the rich and the poor, and has actually become one of the highest in the world. Finding ways to stimulate entrepreneurship in South Africa should be a priority in order to consolidate the democratic gains achieved since 1994.

All the political rhetoric on ‘radical economic transformation’, on ‘meeting National Development Plans’, ‘championing the development needs of SMMEs’, ‘the pro-poor agenda’, ‘catering for the needs on the ground’, ‘changing the economic landscape of South 
Africa’, and ‘changing the patterns of ownership’, and many more other statements, remain nothing but empty slogans if entrepreneurs do not get the respect and recognition they deserve, particularly from state organs such as SEFA. 

The South African government has ‘recognised’ this contribution and therefore has the goal of establishing South Africa as an entrepreneurial nation that rewards and recognises entrepreneurship, but do it’s employees in institutions such as SEFA, IDC, ECDC, NEF, share this vision? Well, given my many years in dealing with these outfits, I doubt their commitment. (I’ve got correspondence dating back years) 

It is more than 10 years now I’ve been labouring on this business and idea, as I mentioned above, I started this venture at a time when many people dismissed me as a dreamer for starting an online news outlet – I knew what I wanted, had a vision and believed in my
 abilities as a hard worker and a visionary – and now years later even some of
the biggest traditional news outlets have online platforms. Even then I was given a run around by the lazy and the inefficient at Gauteng Enterprise Propeller, I must have submitted Business Plans for more than 10 times, without any success. 

If the government is to achieve its targets of creating 11 million jobs, and with the 90% of that expected to be created by entrepreneurs, it must and should do better than the present circus and frustrating merry go round it puts entrepreneurs through.

Particularly those committed and driven entrepreneurs like myself. 

I’m 54 years now, I’ve dedicated more than 30 years of my adult life in entrepreneurial pursuits, therefore I know what I’m doing, I’m dedicated in what I do, I have a vision 
for where the economy of this country and the sub-continent should go, entrepreneurship is my life – and I refuse to be deliberately frustrated and marginalised by people such as xxxxxxxxxx, who don’t seem to know why they were employed by SEFA in the first place, and what is SEFA’s mandate towards the creation of jobs, and growing this country’s economy. 

I know of many committed and dedicated entrepreneurs out there who have a vision of where they want to take the economy of this country, but who get frustrated daily by incompetents who occupy positions of authority with no clue of their mandates and
responsibilities. 

Real entrepreneurs are not interested in making friends in high places, and mingling  

with the ‘high and mighty’, real entrepreneurs want to create wealth, jobs and grow the economy of this country. Real entrepreneurs want to compete with other entrepreneurs from other parts of the world – from China, India, Japan, Singapore, etc. Real entrepreneurs want to test and exchange ideas. We spend our time researching, experimenting and formulating ideas – Our task is to create enterprises, and start businesses, not fight with people who are not entrepreneurs, but who find themselves given the huge responsibility of dealing with entrepreneurs.  

I wish to remind government principals that entrepreneurship is a noble calling, it requires skilled, dedicated and committed servants to service it, and if we want this economy to 
compete on an equal footing with the other advanced and great economies – You better take this country’s entrepreneurs very seriously!!   

On 3/27/18, Toby Chance <toby@tobychance.com> wrote:

> Dear Mr Mali
> Thank you for contacting the portfolio committee about the issue you have
> with Sefa.
> I have read your complaint and I will take it up with the Sefa executive in
> Centurion. What is the current status of your application for funding?
> You story is very revealing of how entrepreneurs are badly treated by
> government officials. You should consider sending it to the media as an open
> letter. I will publish on my blog if you give me permission - see link
> below.
> http://tatamachancesa.blogspot.co.za/
>  Yours
> Toby
> Toby Chance MP
> Parliament of South Africa
> Democratic Alliance
> Shadow Minister for Small Business Development
> Constituency Head: Soweto West
>
> Tel    +27 21 403 3595/8911
> Cel    + 27 83 251 5613
>
> www.tobychance.com
> www.tatamachancesa.blogspot.com
> www.parliament.gov.za
> www.da.org.za
>
> Skype tobychance
> Twitter @tobychance


Good Day Mr Chance

Firstly, I should commend you for a speedy response, this is what this
country needs if we are going to build anything, particularly our
economy.

Go ahead and publish my piece on your blog.

The current status of my application is - Obsolete, I say this because
SEFA has not been able to give me any feedback. They wouldn't because
I'm not one of their friends.

There's a lot of talk about Corruption at SOEs and other government
agencies, the rot is everywhere, particularly in these government
Finance Lending institutions.

I've kept the records of my experiences with these institutions over
the years, the IDC, NEF, GEP (Gauteng Enterprise Propeller), you name
them, you submit your application, and you never hear from them again,
and yet it is said that SMMEs are or should be engines of growth.

Part of the problem is that these institutions are run by people who
are not entrepreneurs, who have no clue about what it is to be an
entrepreneur, and this condition is compounded by their attitudes,
their unwillingness to serve their country and fellow countrymen, an
absence of an accountability ethos, as they know they can always get
away with their crimes. And this is a huge impediment to our country's
economic growth.

It would be worth mentioning here that I have also written letters to
the Presidency, both the Deputy and the President, I have also written
to the Minister of Small Business Development and her Deputy.

They have not come back or acknowledged receipt of my complaint, I'm
watching their every move and want to take them on for their empty
rhetoric and hypocricy.

I appreciate the fact that you are a Shadow Minister of Small
Business, and would really be encouraged to see you take an active and
visible role in championing the entrepreneurs issues, because as I
mentioned in my previuos correspondence, entrepreneurs want to get on
with the business of creating businesses and making jobs in the
process, but it would really strenghten our cause when we have someone
in government who would take up our issues at that level.

Looking forward to a cordial and succesful working relationship

Regards

Jwarha M. Mali