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Financial Planning

Proof that Government is serious about SME growth

By: Ben Bierman – Managing Director of Business Partners Limited (BUSINESS/PARTNERS):
Commenting on the 2018 National Budget Speech delivered earlier this afternoon by Finance Minister Malusi Gigaba, Ben Bierman – Managing Director of Business Partners Limited (BUSINESS/PARTNERS) – says that it is positive to note that there is a consistent theme of SME support in both the recent State of the Nation Address and the National Budget Speech. “This is proof that Government is serious about the growth and well-being of SMEs in South Africa.
“Highlighting this is Government’s commitment to the Preferential Procurement Regulations, as well as the fact that the Public Procurement Bill will be submitted to Cabinet in March 2018 for gazetting for public comments. This regulation will ensure that SMEs are able to participate fairly in the public procurement process, which will in turn promote black economic empowerment, industrialisation and allow SMEs to create more job opportunities.
“It is also key to note that a directive will next week be issued to all government departments and public institutions, instructing them to pay suppliers on time or be charged with financial misconduct. This is crucial to the survival of a small business as late payment has a direct impact on a business’s cash flow and the speed of its cash conversion cycle, which ultimately impacts its overall profitability,” says Bierman.
He adds that the announcement of the revised Financial Sector Codes and the R100 billion Black Business Growth Fund created through the code will have a significant impact on black businesses growth. “This initiative is expected to dramatically improve access to funding for black owned businesses who previously may have had difficulty to obtain this kind of funding. We are confident that the initiative will impact transformation and look forward to witnessing its implementation.”
Commenting on provisional allocation of R2.1 billion to the SME Incubation Fund announced in the MTBPS, Bierman points out that that although this is a positive increased initiative, it is disappointing that it will only begin operating in 2019/20, as SMEs need support now more than ever.

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