Eskom load shedding state of disaster

DA leader, John Steenhuisen.
Photo: Courtney Africa/African News Agency(ANA)

DA seek clarity on racial requirements for SMME funding

Frustrated South Africans are still looking for answers following a leaked draft document that said only 51% black-owned companies would benefit.

Eskom load shedding state of disaster

DA leader, John Steenhuisen.
Photo: Courtney Africa/African News Agency(ANA)

The Democratic Alliance (DA) has urged the Department of Small Business Development to pull its socks up and clarify controversial details of its funding criteria. 

On Tuesday 24 March, The South African reported that a document reportedly leaked from the department prior to its revision had been widely shared on social media. In the document, which the department confirmed was merely a draft that should not have been leaked, the requisite criteria for SMMEs (small, medium and micro enterprise) to apply for a relief package included that the business be 51% black-owned.

The South African reported that the criteria detailed in the document was fake news, but an outcry from AfriForum, it’s supporters, and many South Africans directly implicated by the prospect of racial bias has prompted the DA to seek clarity. 

“The Democratic Alliance (DA) has noted with concern the teething problems that accompanied the initiation of the Small Business Development Department’s COVID-19 relief response yesterday, centred on problems with the SMME registration website and mixed messaging about implementation.”

“We will therefore urgently request the Minister of Small Business Development, Khumbudzo Ntshavheni, to intervene to ensure that her department mitigate any further adverse impact of the current pandemic on small businesses.”

Clarity required

The DA called for the minister to sure up her policy regarding representative ownership of businesses, and explain to what extent “representative” assistance would be applicable. 

On Tuesday, Ntshavheni said that the fund was available to all South Africans, but said that 70% of the beneficiaries should be BEE compliant.

“For SMMEs to be eligible for assistance under the debt relief fund, the applicant must demonstrate the direct link of the impact or the potential impact of Covid-19 on business operations,” Ntshavheni said.

“This facility will also assist entities to acquire raw material, pay labour and operational costs. All these interventions will be structured to match the patterns of the SMMEs cash flows, as well as the extent of the impact suffered.”

Ntshavheni said businesses wanting to apply for funding assistance need to meet several criteria:

  • They must be 100% owned by South African citizens;
  • They should employ at least 70% SA nationals; and
  • They must be registered with the South African Revenue Service (SARS) and tax-compliant.

She said priority will be given to businesses owned by females, the youth and persons with disabilities.

The DA want more clarity though, and said that race shouldn’t be a factor in determining who is eligible. 

“The DA believes that to provide clarity and peace of mind on this matter, the race of the business owner should be removed as a question on the online registration form and the website redesigned to resolve the aforementioned shortcomings.”

‘Buggy’ website issues

They also made mention of the website’s poor operation, saying that it is not secure enough and had been pinging back error messages, with non-operational call centres. 

“The website is not secure and should be encrypted by activating an SSL certificate (which should be a basic feature for any website), in light of the sensitive information being requested.”

“Error messages from the website and the helpline call centre not being operational, with multiple call attempts not being picked up. While the department had indicated that they have an IT team working on the website’s glitches, they must ensure that such glitches are not an ongoing problem.”