Rowan Callaghan
Negotiations between the Department of Trade and Industry (DTI) and the Small Business Development Corporation (SBDC) have gone largely unnoticed until a deadlock in talks caused the corporation’s annual general meeting (AGM) to be re-scheduled last week.
The SBDC has long been a target of criticism by particularly small black business, who have felt the SBDC has not done enough to empower them.
That the state owns a share of the corporation, it has been argued, should give it a bigger say in the way the SBDC is run.
The SBDC, on the other hand, has maintained that its independence is a valuable barrier to political corruption and eventual bankruptcy.
According to an SBDC spokesperson, negotiations which started around September 1994 are centred on “the reduction of the state’s shareholding in the SBDC by way of a transfer of assets, functions and staff”.
The SBDC believes the DTI is interfering in its decision-making and it argues that it “is not a quasi- government statutory body”.
A source close to the SBDC says he believes it is the corporation’s “white top leadership” that is the sore point with the new government.
He said the organisation tried to avoid taking too many risks. He added that it tried to do this by “getting the government out” and becoming a commercial institution. This would then give the corporation the freedom to operate without government interference.
“They (The DTI) don’t want assets, they want cash,” he said. “The only way to solve the political feud around the SBDC is to decentralise it.”
The SBDC claims that management was never an articulated issue.
“An agreement has been reached with representatives of the DTI that certain assets, functions and staff of the SBDC are to be transferred to the newly created government-controlled small business development agency,” the SBDC said in response to the claim that government negotiators would only settle for cash.
The corporation was confident that further issues would be resolved before the October 6 date set for the AGM.