The Centre for Entrepreneurship and Innovation (CEI) at the University of the Western Cape (UWC) hopes provision will be made for Small Medium and Micro Enterprises (SMMEs), as the Finance Minister delivers his budget speech this week.

Finance Minister Enoch Godongwana is expected to provide details on spending and collectables and elaborate on promises made by the president during his State of the Nation Address (SONA) earlier this month.

Data released before the lockdown by the Annual Financial Statistics (AFS) survey shows small businesses' growing role in the formal business sector. Small businesses generate just over one-fifth of total turnover. Turnover includes money received from the sales of goods and/or from services rendered.

The CEI has applauded government efforts to finalise amendments to the Business Act to reduce regulatory impediments for SMMEs and co-operatives but has called for more clarity on funding requirements. During SONA, President Cyril Ramaphosa highlighted key focus areas in reducing red tape for entrepreneurs.  

The CEI's purpose is to provide holistic and integrated entrepreneurial development support for both students and the broader community of SMMEs in the Western Cape.

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CEI Director Abe Oliver believes reducing regulatory impediments for SMMEs is imperative when helping future entrepreneurs get their businesses off the ground, but stresses certain things could be improved in the process.

‘’The Department of Labour should look at companies' HR policies and ensure that SMME employees are registered for UIF. The Company of Intellectual Property and Commission Compliance (CIPC) is also critical for ensuring that Business 2 Business trading activities are an option. There is even more regulation for SMMEs who operate within the hospitality industry, such as food licenses and appropriate trading licenses etc. There are a number of regulatory impediments,” said Oliver.

Oliver said many SMMEs which survived Covid-19 are still licking their wounds while trying to weather another crisis – loadshedding.

Oliver has, however, welcomed Ramaphosa's recent announcement of plans to provide R1.4-billion rand in financing to over 90 000 entrepreneurs through the Small Enterprise Finance Agency (SEFA) but remains cautiously optimistic.

“The criteria should be stipulated, because small businesses are waiting in hope, to then later be made aware that they don’t meet the necessary requirements,’’ he explained.

Oliver said as several sectors look to the government for a financial lifeline, special emphasis and focus needs to be placed on SMMEs which are pivotal to the success of South Africa’s economy and are the backbone of many communities.

Mr Abraham Oliver is the Director at the Centre for Entrepreneurship and Innovation (CEI), University of the Western Cape.  Oliver is an incubator and Growthwheel specialist. He is further an experienced and professional SME practitioner both in the art and science of entrepreneurship. His experience spans over more than 25 years both in academia and SMME business modeling support.