Policy paradigm shift needed to grow SMMEs in the city

08 March 2017

 

The City of Johannesburg had identified job creation and access to procurement opportunities by small, medium and micro enterprises (SMMEs) as essential ingredients in building an economically viable city, Member of the Mayoral Committee for Finance Cllr Rabelani Dagada said on Tuesday March 7.

 

Speaking during the City’s economic opportunities roadshow at Diepkloof Hall in Soweto, Cllr Dagada said, however, that the uneven playing fields in the economic arena had resulted in limited participation by SMMEs.

He said the City had also recognised that the current laws and competitive landscapes were obstacles to the growth and survival of SMMEs.

“Achievement of this noble goal necessitates a paradigm shift in the supply chain management policies and procedures of the City [as it will] create an enabling environment for SMMEs,” he said.

Cllr Dagada said other measures to be implemented included the waiving of tariffs for SMMEs and the identification and reservation of quotations and bids solely for SMMEs. He said the City would leverage its procurement spend, use regulatory instruments and provide business support for previously marginalised groups.

The roadshow formed part of the City’s objective to create employment, eradicate poverty, stimulate growth and provide business development by giving support to co-operatives and SMMEs. It was also in line with the City’s objective of growing Johannesburg’s economy by at least 5% by 2021 as espoused in its new 10-point plan.

The workshop was also addressed by Solly Mlambo, Manager in the Finance Department’s Strategic Supply Chain Management Unit. He urged co-operatives and SMMEs to come together to form one business forum. This, Mlambo said, would enable them to speak with one voice when engaging the City on the implementation of its policies.

Mlambo warned SMMEs that they would not grow beyond subcontractors’ status if they did not unite to help and support one another in challenging the main contractors in demanding their 30% share of projects as stipulated in the City’s procurement policies.

“It’s high time you’re organised and demand from the big contractors what is due to you. You must not compete with each other but co-operate with each other,” Mlambo said.

He also warned SMMEs to be compliant as failure to do so would deny them access to procurement opportunities.

“Compliance is not negotiable,” Mlambo said.

Thabile Ntsoeseng of the Pimville Forum said SMMEs were not benefiting from the City’s procurement cake as established contractors only gave them crumbs.

Thomas Selala, chairman of the Region E Business Forum, concurred with Ntsoeseng, saying it was high time SMMEs were taken seriously by the main contractors.

“We hear of economic transformation but we have not seen it in the past seven years. Enough is enough,” Selala said.