The Department of Trade and Industry is to launch the Small Enterprise Development Agency (Seda) next week, replacing small-business promotion agencies Ntsika and the National Manufacturing Advice Centre (Namac).
The move represents a policy shift by the department. “Our approach with Ntsika and Khula [Finance] was that the government would act as a wholesaler. There was a proliferation of support organisations … at different levels. We want to see a far bigger role for government,” the Deputy Director General, Lionel October, told the Financial Mail.
Seda will provide non-financial advisory and support services. The department’s chief operating officer, Hlonela Lupuwana, said it would incorporate most of the activities of Ntsika and Namac and would be represented at all levels of government.
Although there are a million small, medium and micro-enterprises in South Africa and three million hawkers, there is consensus that government efforts to support and promote small business have failed.
Hundreds of millions of rands have been wasted as government development funders have lurched from crisis to crisis. This has culminated in calls for the closure of some agencies, particularly Ntsika and Khula Finance.
President Thabo Mbeki laid heavy emphasis on small-business development in his State of the Nation address last year. And Minister of Trade and Industry Mandisi Mpahlwa warned in June that state agencies that were not delivering should not expect government support.
October said the decision to launch Seda followed an extensive review of small business programmes. He would not be drawn on the structural details of the new agency, saying Mpahlwa would provide these at a business summit in Johannesburg next week.
Big News editor Barrie Terblanche warned that for Seda to succeed, the department should separate business development and poverty alleviation.Â
“Ntsika and other agencies wasted millions of rands on the wrong market. The solution is to help proper businesses create jobs,” he said.