By Noko Mashilo
Gauteng Finance and Economic Development MEC Lebogang Maile has reiterated the urgent need to accelerate financial support for SMMEs across the province, announcing that the current 30-day payment period for small businesses by the government will be changed and SMMEs will be paid in 15 days: Maile Delivering Gauteng’s Medium-Term Budget Policy Statement, Maile acknowledged the pivotal role of SMMEs in driving job creation and economic growth.
He said the new measure aimed to address cashflow constraints faced by small businesses, enabling them to maintain operations, invest in growth, and contribute more effectively to the broader economy. “It is important to pay SMMEs on time. Failure to do so cripples them and undermines their ability to contribute positively to the economy,” said Maile.
To realise this vision, Maile stated that all Gauteng government departments must incorporate preferential procurement planning into their strategies. This approach would rely on thorough market research, industry analysis, sectoral transformation levels, and the identification of MSMEs owned by designated groups.
Maile also highlighted the importance of prioritising invoice payment compliance. “Reducing the time taken to settle invoices for suppliers and service providers remains a top priority, as cash flow is critical to the survival of businesses. Meeting the 30-day payment compliance requirement is essential to align with legislative mandates,” he added.
The MEC further noted the untapped potential of the township economy, with MSMEs acting as vital engines of local economic activity. However, these businesses continued to face significant challenges, including limited access to finance, inadequate infrastructure, and regulatory hurdles. Maile cited the Township Economic Development Act as a cornerstone of Gauteng’s strategy to revitalise township economies, drawing inspiration from global best practices in informal sector development.
“Small enterprises are essential to Gauteng’s economy and a key driver of job creation. That is why the provincial government is intensifying support for small businesses, from start-up to expansion, by facilitating access to finance and business development services,” Maile said. There has been a mixed reaction to the MEC’s budget statement.
Funzi Ngubeni, Chairperson of ActionSA in Gauteng, welcomed the focus on the township economy but raised concerns about the limited emphasis on SMMEs. “While the MEC highlighted the township economy, there was little mention of specific mechanisms to ensure that funding reaches the relevant SMMEs. The funds exist but are not reaching their intended beneficiaries,” said Ngubeni.
Black Entrepreneurs Alliance CEO Refilwe Monageng was less optimistic, describing the speech as unrealistic. “There is nothing new in the MEC’s remarks. What happened to implementing Sections 2 and 3 of the Gauteng Economic Development Act? Without a solid foundation, other initiatives cannot progress. We need to see the implementation of the Gauteng Township Economic Development Act and the unlocking of the Gauteng Township Fund as priorities,” Monageng stated.
He also criticised the state’s payment system, expressing disappointment over the continued non-payment of SMMEs. “The MEC’s promises are far-fetched. We still see a significant number of SMMEs waiting for payment,” Monageng added.
