The chairperson of South Africa’s Portfolio Committee on Small Business Development Ruth Bhengu has called on the Department of Small Business Development to better assist small and medium enterprises (SMEs) by investing in them rather than giving grants.
Bhengu said the country needed businesses that are effective, self-sustaining, income generating and able to contribute to job creation.
“Capital investment will be a better option than giving out grants, as they do not empower people but promote a culture of dependency,” she said.
She made the comments as the Portfolio Committee on Small Business Development visited spaza shops and cooperatives meant to empower people with disabilities in Soweto, Kagiso and Jeppestown.
Small business owners speaking to the committee raised concerns over lack of financial support, unfair competition from foreign nationals, late payment of invoices by government and policies that stifle the process of starting a business.
“Government officials need to be in touch with people on the ground if they want to address the poverty question in the country. Business plans should also be informed by visits to small business enterprises and not by perceived needs,” Bhengu said.