Government has given South African small businesses and cooperatives a lifeline.
This after government announced that it has set aside 30 percent of its procurement spend for services from small businesses, and cooperatives.
Minister in The Presidency for Planning, Monitoring and Evaluation, Jeff Radebe, announced this shortly after the Cabinet Lekgotla held recently.
He said a new Procurement Bill developed by National Treasury that will be introduced next year, would ensure that 30 percent of government contracts are set aside for small companies, cooperatives and township businesses.
“Government would introduce legislative amendments to implement the 30 percent set aside to unlock the potential of SMMEs, cooperatives and the township and rural enterprises. This would be done by March 2017,” said Minister Radebe.
He added that this was part of government’s evaluations of financial incentives for business to strengthen and achieve greater value for money to enhance more inclusive growth.
Government will continue to focus on labour-intensive sectors, including the need for various mechanisms to support greater impact on jobs, such as the use of the incentive programmes, amongst others: clothing, textiles, leather and footwear value-chain; agro-processing and business process services.
The economy was top of the agenda at the Cabinet
Lekgotla as government assessed its mid-term performance.
Cabinet is working on reprioritising the budget to align it to the National Development Plan (NDP) and the Medium-Term Strategic Framework (MTSF).
“National Treasury and the Department of Planning, Monitoring and Evaluation presented their recommendations on work done in the past year to align the national budget to the NDP and the MTSF,” Minister Radebe said.
Government has also identified a set of budget priorities for 2017/18 that focus on maintaining infrastructure spend, strengthening support for skills development and maintaining real levels of spending on the poor.
Work on identifying efficiencies and savings over the remainder of the Medium-Term Expenditure Framework will continue, said Minister Radebe.
The Minister also said that the Inter-Ministerial Committee on Investment will coordinate 40 projects in which government will invest. These projects include agro-processing and agri-parks to ensure that farmers are able to not only produce, but also process and package goods.
Cabinet also discussed energy and infrastructure, manufacturing and services projects that will be a top priority for government.
As the country struggles with water shortages, government encouraged South Africans to save water and minimise water losses. “By September 2016, agreements are to be completed with Municipalities with high water losses, to facilitate placement of agents, and a clear funding model is to be completed.”