Date: 10/06/2003
Source: Ministry of Trade and Industry
Title: Hendricks: Debate on National Small Business Amendment Bill


DEBATE ON THE NATIONAL SMALL BUSINESS AMENDMENT BILL, BY DEPUTY MINISTER OF TRADE AND INDUSTRY, LINDIWE HENDRICKS, National Assembly, 10 June 2003

Madam Speaker
Honourable Members

The National Small Business Amendment Bill has undergone extensive consultation and debate, both inside and outside Parliament. Last year we took the proposed amendments to business forums across the country and received a number of inputs and recommendations, which were incorporated into the Bill. The introduction of the National Small Business Amendment Bill took place in April 2003 and since then there have been public hearings, which took place on the 23rd and 27th May 2003. The issues coming from these hearings and the concerns of the Parliamentary Committee on Trade and Industry have been taken into consideration in this Bill.

Members are aware that small Business Development is extremely important for the growth of the economy, creation of jobs and to improve the levels of equity. The support of this sector by the government is therefore critical and is a priority. The house will recall that the development of this sector has been a priority since 1994 and one of the first pieces of legislation to come before this house was the White Paper on the National Strategy for the Development and Promotion of Small Business in South Africa; this was followed by the National Small Business Act, 102 of 1996.

The Bill is amending certain provisions of the National Small Business Act. Apart from the technical elements of aligning the Act with other pieces of legislation for example, the PFMA, the amendments essentially seek to give the Minister powers to facilitate creation of a voice for small business and that this be done in consultation with the business community. This voice or Advisory Body is long overdue, as the void created by the liquidation of the National Small Business Council has never been filled. In order to improve our effectiveness in the support that we provide to the small business sector and in the creation of an enabling environment for small businesses, it is necessary that we formalise and have a structured relationship between government and a representative body of small business in the country.

The purpose of this body would be to advise government on critical issues such as:

* The impact of current and new legislation on small business;
* Identification of areas of market failure for small businesses so that appropriate support and interventions can be made;
* Provide advice on the constraints, needs, and communication mechanisms to interface with small businesses; and
* Methods to monitor support services to the small business sector.

The amendments also seek to streamline the role of Ntsika to focus on support programmes and to transfer the policy research aspect to the dti. During our consultations and discussions we heard concerns expressed about Ntsika and have already embarked on a process to rectify the situation.

Madam speaker, honourable members, during the consultative process there has been general support for the amendments and the requests made during this process to rephrase Chapter 2 of the Bill so that it articulate the terms of reference of the Advisory body have been accepted. Therefore, as outlined in Chapter 2 of the Bill, we will be ensuring the establishment of an Advisory Body to represent and promote the interest of small business takes place within a reasonable time; and that through an open and transparent process of consultation, the constitution for the Advisory Body is determined. The provisions of the constitution are outlined in Chapter 2, section 3.2, as are the terms of reference for the Advisory Body.

We are convinced that these amendments provide a legislative framework to underpin the dti's endeavours to create an enabling environment for Small, Medium and Micro Enterprises (SMMEs) in South Africa.

Issued by Ministry of Trade and Industry
10 June 2003