• 10 tips to find bargains

    Susan Erasmus gives advice on how bargain hunters can get the most bang for their buck.

  • Inside Labour

    Labour's bitter breaches need to be seen in historical context, says Terry Bell.

  • Rich getting richer

    Economists differ on how to tackle the chasm between rich and poor, says Leopold Scholtz.

See More

IDC cancels R5bn distress funding

Oct 26 2010 10:49 Sikonathi Mantshantsha

Related Articles

IDC to hike funding fivefold

IDC mum over Moz polluting smelter

'Panic and fear' at IDC

IDC debt set to rocket

IDC launches short-term finance product

IDC gave R1.4bn to struggling firms

Johannesburg – Half of the R10.7bn total funding the Industrial Development Corporation (IDC) committed towards assisting companies during last year's recession was cancelled without being disbursed to the applicants.

The IDC's annual report to March 2010 shows that "undrawn commitments" of R5.1bn of the previous year's funding approvals was cancelled during the financial year.

The figure was a 76% increase from the R2.9bn of cancellations in the year ended March 2009.

Coming off the IDC's "record high approvals of R10.7bn", the R5.1bn would have gone to 40 of the 253 companies whose funding applications were approved.

That amounts to an average R128m for each application, compared to an average R93m in the prior year's failures.

That means only R5.6bn of the R10.7bn that was approved reached its intended beneficiaries and played a role in the saving of or creation of 35 000 jobs as claimed by the IDC during the financial year.

The annual report is silent on what caused the companies not to claim their funds and on Tuesday morning the IDC was still formulating a response to Fin24's questions.

Considering that the corporation had budgeted an additional R6.1bn for companies distressed by the economic slowdown during 2007 and 2008, it would not be unreasonable to assume that not many of those companies were still in existence by the time the money became available.

SA lost close to 1 million jobs last year during the recession.

In January 2010, a businessman who accused the IDC of sending him "back and forth for far too long" before deciding on his funding application, lost his cool and destroyed property at the corporation's headquarters in Sandton.

He was arrested on vandalism charges.

In July the corporation reported that it had approved R1.4bn in funding to distressed companies last year.

- Fin24



Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Add your comment
Comment 0 characters remaining

Company Snapshot

Brought to you by BizNews

More from BizNews

We're talking about:


Johannesburg has been selected to host the Global Entrepreneurship Congress in 2017. "[The congress] will ensure that small business development remains firmly on the national agenda and the radar screen of all stakeholders, the Small Business Development minister said.

Top 10 richest musicians of all time

Check out the gallery to find out who they are!


Luxury living

Seven of the most expensive children's toys ever made
5 millionaires turned murderers
The youngest billionaires in the world and how they made it
Watch: Flying first class has never been this luxurious!

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

How do you see your boss? He/sheis:

Previous results · Suggest a vote