Too broke to help small businesses
Cash-strapped SEDA may have to seek alternatives
The Small Enterprise Development Agency (Seda) has warned that the deep budget cuts it has had to implement will negatively affect its operations.
Seda, an agency of the Department of Small Business Development (DSBD) that provides non-financial support to small enterprises and cooperatives, saw its allocation for the next three years cut by R305-million.
“Seda has also experienced reduced funding from partner organisations. Reduction in partnership initiatives commits Seda to seek alternative funding to continue with such initiatives. Seda often cannot terminate these initiatives which may include service centres,” the entity said in its annual performance plan tabled at parliament.
Seda and its sister entity, the Small Enterprise Finance Agency (Sefa), had a lacklustre year in 2021 and failed to reach their targets. Seda achieved 12 of its 23 annual performance targets, while the Sefa only reached five of its 17 annual targets.
There is a proposed merger between Sada, Sefa and the Cooperative Banks Development Agency.
Cabinet this month approved the 20-month extension period for the merger, which was initially set to be effective from April 1.
This followed Cabinet approval for the merger to ensure government provides a single entity that will support its work in supporting small to medium enterprises and cooperatives.
Seda board chairperson Matshediso Ndlovu said the merged entity will be positioned as a one-stop shop for the needs of SMME development.
“This will be achieved through shared platforms for information access, services access points, seamless services for both pre-finance and post-finance support. Market access to both local and international markets is essential to enable small businesses’ exposure and access to procurement opportunities,” Ndlovu said.
She added that the current Seda enterprise and supplier development model will be augmented to enable more partnerships with the private sector to increase SMME participation.
MPS also pressed the DSBD on when it will finalise its organogram.
The department, which was established in July 2014, does still not have an organogram and many of its bodies, such as the small business advisory council, have still not been established.
Small Business Development Minister Stella Ndabeni-abra
hams expressed her commitment to finalising the organogram because of its importance to the department’s mandate.
“The department will identify the gaps and add them to the organogram to ensure it does not leave anyone out, including informal traders,” she said.
Seda has also experienced reduced funding from partner organisations