By Mbangwa Xaba

Political leaders – both in government and the opposition – delivered moving speeches to mark the celebration of Women’s Month.
President Cyril Ramaphosa’s heart-warming women’s economic assembly announcement and DA’s John Steenhuisen’s Midvaal Municipality’s launch of Sebenza Imbokodo Women’s Fund were noteworthy.

These initiatives are ideal to dismantling society’s endemic economic inequalities.
Only if.

You see, the announcements would have been earth shuttering, they would have been a course for rapturous ululation for a nation on the economic cliff hanger. We would be talking about indispensable and life-saving tools in a difficult economic climb.

Thing is, we have heard it all before, and yet here we are, holding on in a perilous economic downslope.

I could waffle on about numerous previous policy statements, grand economic development programmes or even entities with huge budgets. We have far too many grand thoughts for the same purpose or of similar significance. Be it for the youth, people with disabilities or military veterans, but I would rather we talk basics.

I must admit, I am not chuffed by new pronouncements. Very little will, if anything at all, could be achieved from such grand schemes if we can’t take care of the easy stuff.

Can we have easy registration of companies, less punitive tax regimes like deregistration of companies, easy registration on the ‘vendor database’. The registration process is likely to take longer if you put a comma in the wrong place. Some bureaucrats make it their business to be non-responsive to the needs of small business.

More distressing is payment. You go through all these unnecessary hoops, then it takes months before you see your payment!

A Midvaal lady, who can’t wait to get her hands on the Steenhuisen funds, my advice is: ‘hold your breath for a bit longer sisi, these things take forever. You must first suffer from red tape and government bureaucracy, deal with bundles of paperwork, countless certificates and long hours of waiting. That’s small business and entrepreneurship in this country. It is almost as if the bureaucracy has no idea that those who start businesses are disparate people who need to survive.

These are people who cannot cope with this type of hoop jumping. According to statistics South Africa (SatsSA), as many as 70% of small businesses fold in the first two and a half years, and less than 20% of startups prosper and flourish.

Heaven knows why StatsSA says that “those who operated informal businesses did not use their own money to start their businesses, most borrowed the money from friends and relatives,” and a government they are part of would have systems that are inconsiderate.
The vast majority of people who started informal businesses used their own money to do so (over 70,0%).

StatsSA tells us that “as many as 79,1% of persons running informal businesses did not have a bank account. And over 90% had no credit facilities, no asset finance or mortgage loans for their business operations.”

Yet the same government would not pay small business for months. The Business Debt Index (BDI) says, “outstanding debtor days soared to record levels in the second quarter of 2019. A year ago, the average payment turnaround time on small business invoices was below 60 days. Now, SMEs have to wait for an average of 66,4 days to get paid. For an increasing number of micro-enterprises, that is simply too long.”

The impact of late payment to startups and SMEs is devastating. Small companies, more than their larger counterparts, require a predictable income stream.

Without a positive cash flow, business owners are unable to meet their financial obligations. The culture of late payment in the public and private sectors does not only hamper small business growth in South Africa, it is killing off existing micro-enterprises at an alarming rate.
As if this was not enough, we must deal with raging corruption. Claims are abound that if you want to do business with government you need brown envelops and the same practice is expected if you want to get paid.

This is heartbreaking because we need public expenditure among others to grow economy and create jobs.

Public procurement is crucial since it encompasses all purchases of goods and services by public institutions. It involves contracts between the government and the private sector in a variety of areas such as health services, the military, construction, etc. Reliable procurement practices transform funds into hospitals, schools and roads. If spent well, this is serious money that can make a difference in our economically distressed society.

But corruption in public procurement takes away benefits meant for citizens. Billions of rands slip through the cracks, ending up eroding an already trust-deficient relationship between the people and the state.

In local government things are said to go haywire. The financial position of just over a quarter of municipalities is so dire that there is doubt that they will be able to continue meet their obligations in the future. Almost half of the municipalities are already under financial strain, including low debt recovery, an inability to pay creditors and operating deficits. Like many of my country men and women, I would be happy to see new and bold initiatives by those in power. Our leaders should fix the little everyday challenges first before coming up with all these bright ideas.

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