By: Anna Majavu
There are 29 different laws that tangle SMMEs up in red tape, according to the Small Business Development Department. “That was an indictment on us, and on the Department of Trade and Industry and on the other departments that work with small business, that the president had to appoint a special office to cut red tape across government,” newly-appointed Small Business Development Deputy Minister Dipuo Peters told the Portfolio Committee on Small Business Development on Wednesday.
Ramaphosa appointed a red tape team in the Presidency in February 2022 with former Sasol chairperson Sipho Nkosi as the red tape champion. The Small Business Development Department has been promising Parliament since around 2015 that it will reduce the amount of red tape that SMMEs face in trying to set up their businesses. “No national strategy ever existed until now to reduce red tape. The field of red tape reduction suffers from a lack of coherence and cohesiveness without any clear guidelines on what we need to achieve,” acting deputy director-general Mojalefa Mohoto told the portfolio committee.
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Mohoto said that the department was now planning to reform the 29 laws that hindered SMMEs. Meanwhile, some provinces had already made progress, he said. Gauteng was able to pay invoices from SMMEs within 15 days and had also reduced the time it took to grant taxi licences, while the Western Cape had set up digital channels for businesses to apply for all the permits they needed online. KwaZulu-Natal was also making progress, Mohoto said, by setting up a system to resolve complaints about licence delays from small businesses.
The department also wanted municipalities to grant informal traders licences within a certain timeframe, and if they failed to do so, the traders would be deemed to have secured a licence and would be allowed to trade without having their goods confiscated. Mohoto said the department was also looking into high business licence fees levied by municipalities. “The range is so wide and, in some cases, the costs become a barrier,” Mohoto said.
Director-general Lindokuhle Mkhumane said the department aimed to have all business licences issued online “to minimise human involvement” after hearing that some councillors were issuing licences from their homes during the Covid-19 pandemic. But ANC MP Faiez Jacobs said the presentation was “very generic” and lacked deadlines “South Africans are really good at establishing task teams and describing the problem but if our lives were dependent on it, we should have sorted out red tape long ago,” said Jacobs. The department is due to table an action plan on red tape reduction to Cabinet by 31 March.
