Govt spend on township economy on track

1st April 2016 By: Sydney Majoko

The Inaugural Gauteng Township Entrepreneur Awards honoured the ‘father’ of township entrepreneurship, Richard Maponya, with a Lifetime Achieve- ment Award. This is a fitting honour to the owner of Maponya Mall, in Soweto. He has done almost everything in the township economy. That such awards are held and honour entrepreneurs like him bears testimony to the fact that the township economy is now firmly entrenched as a recognised entity by government.

In his recent State of the Province address, Gauteng Premier David Makhura detailed how government was doing all it could to stick to its objectives of increasing its use of the services of township business in its procurement of goods and services.

“In the first full year of the implementation of our Township Economy Revitalisation Strategy, the provincial government spent R1.8-billion on procuring goods and services from township enterprises. In addition, municipalities are spending R1.6-billion of their procurement budgets on township enter- prises. We have already reached the 12% target we set for the 2015/16 financial year and are certainly gaining momentum towards spending at least 30% of our procurement budget on township enterprises by 2019.”

That government is leading the way by aiming to spend up to one-third of its procurement budget in the township economy should be enough indication to anyone still doubting the importance of this sector of the economy. The fight against unemployment starts with government breathing life into a sector of the economy that offers incredible entrepreneurial opportunities.

Part of the Premier’s State of the Province address went as far as identifying individuals who have come up with innovative ways of doing business in the township economy. Nthabiseng Likhotsi was specifically mentioned for her work in the formation of a community cooperative bank that assists its members with finance for their business start-ups or improving their existing businesses.

This column has in the past stressed the need for ‘out-of-the-box’ thinking when it comes to the way in which the township economy operates. Encouraging residents to start businesses is one thing, but having an entrepreneur start a car wash and then having the local Metro Police Department support that car wash by taking its fleet there to be cleaned is innovative. This was the case with Tsepo Rampatla, whose car wash cooperative in Mamelodi is receiving the support of the local Tshwane Metropolitan Police Department.

The Premier also stressed the importance of government’s new Ntirhisano initiative, which involves cooperation between communities and government in the field service delivery. This has already seen a significant drop in service delivery protests. The spin-offs of this continued cooperation are immense for township economy entrepreneurs.

Although not immediately obvious to an outside observer, community upheavals of any kind result in lost business days for all businesses in the township concerned – foreign- owned and locally owned businesses suffer equally.

One of the factors that contribute to keeping investors out of the township economy is the perceived instability of the market. The threat of eruptions of service delivery protests or xenophobic violence is always in the background. Ntirhisano, if applied consistently, should go a long way towards ensuring economically stable conditions, which will enable entre- preneurs to excel.

Ntirhisano could be the launch pad for many areas of cooperation between communities and government. More importantly, it could also be the beginning of initiatives that put local businesses at the forefront of supplying goods and services to their local municipalities.

It is still not uncommon for a water leak in the street to persist for three days or more in the townships because no one wants to own the problem if it is not in their yard. However, through Ntirhisano, residents would realise that reporting the problem will benefit not only to the municipality but also a local entrepreneur who gets to fix the problem.

Government’s focus on spending up to 30% of its procurement budget in the township economy, coupled with Ntirhisano, can only mean a brilliant future for the township economy and the fight against unemployment.