Document: NSBAC: Strategic Business Plan 2010 - 2013

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In terms of the National Small Business Act, 1996 (Act No. 102 of 1996), adapted as the National Small Business Amended Act, 2003 (Act No. 26 of 2003), the Minister of Trade and Industry facilitated the establishment of an advisory body. This body would represent and promote the interests of the small business sector as envisaged in the National Strategy for the Development and Promotion of Small Business (NSDPSB) in South Africa. The body is the National Small Business Advisory Council (NSBAC) and operates on a tenured basis with a three-year service cycle. It acts as an advisory body to the Minister of Trade and Industry on matters pertaining to the promotion of small business in the country.

This document sets out the primary strategic plan of the NSBAC. The ministerial mandate, synthesised from the national priorities of the country, has informed the programme. Such mandate includes employment creation, the NSDPSB and the strategic objectives of Medium-Term Strategic Framework of the Department of Trade and Industry (the dti). The Plan will be revisited annually and form the basis of the annual work programme of the NSBAC. The NSBAC operates with a secretariat, comprising permanent employees of the dti, which assists in all operational matters.
 
There are three primary working groups in each of the following primary areas:
  • Access to finance;
  • Demand and markets; and
  • Regulatory review.
The work programme developed in each of these areas will be executed during the NSBAC’s mandate for this cycle, which commenced in April 2010 and will conclude in March 2013. 
 
Essentially, during this term, the NSBAC intends to establish ways in which to reduce or eliminate the institutional barriers that are hampering the development of a vibrant and significant entrepreneurship sector in South Africa. The NSBAC will advise the Minister of Trade and Industry actively on the policy, legacy and institutional arrangements required to create a robust support system for business development. Such a support system should achieve tangible output in developing small business in the country.
 
A key to success is the evaluation of what has and what has not worked in small business development to date. Many interventions and models have been tried, some at great expense to government. However, the culture of entrepreneurship envisaged in the White Paper on Small Business Development has not translated into widespread employment creation. In this context, small business development is not only a critical enabler of the South African economy, but also a tool for transformation and global competitiveness.
 
Several main themes and challenges have emerged. Among them is access to finance. This, driven by institutions and policies, is still a barrier and will remain a challenge, until such constraints are quantified.
 
As a key intervention, the Industrial Policy Action Plan 2010/11 – 2012/13 (IPAP 2) offers an economic transformation agenda that enables South Africa to take its rightful place as a driver of economic growth, continentally and worldwide. The growth and development strategies of every province include the expansion of the small business sector. IPAP 2 sets the stage for South Africa to play a major role in green technologies, innovation and the use of technology to achieve development. It explores strategies to make key economic sectors globally competitive and examines the comparative strength of the country in driving
economic growth.
 
The Companies Act, 2008 (Act No. 71 of 2008) promises to level the playing fields, enabling big and small business to compete on an equal footing in certain areas.
 
The Competition Commission and Tribunal play a significant role in intervening in markets. The NSBAC questions whether it does enough for small business, though.
 
Broad-Based Black Economic Empowerment (B-BBEE) Codes of Good Practice and other interventions have achieved elements of transformation. However, the preoccupation with compliance rather than active participation has all but negated the anticipated impact on small business. This has been particularly noticeable in enterprise development, local beneficiation, supply-chain transformation and overall achievement of socio-economic transformation.
 
Various incentive and institutional models, which had and continue to have small business development as their objectives, have been in place over the last 10 to 15 years. While negative and positive incentives each have their own merits, regulation as a form of negative incentive apparently does not work. Compliance versus incentives has given rise to major debate. Businesses need to be motivated to transform through initiatives focusing on supplier mentoring, supplier diversity, buyer education and re-education. It is the role of the NSBAC to examine issues critically to address these challenges with best-practice and practical solutions.
 
Thus, the NSBAC will be scrutinising various interventions that have not worked and need to be consolidated, as well as those that have succeeded and need to be supported more aggressively to achieve sustainable results. The NSBAC will grapple with these and similar issues, offering practical solutions on behalf of the Minister of Trade and Industry.

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NSBAC: Strategic Business Plan 2010 - 2013

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National Small Business Advisory Council (NSBAC)

Publication Year

2010

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