WATCH: We will hold government to account if they don't pay SMMEs - Zulu

Cape Town – Systems were being put in place to ensure government departments are held to account when they don’t pay SMMEs and cooperatives within 30 days, Small Business Development Minister Lindiwe Zulu said on Thursday.

In an exclusive Fin24 studio interview a day after her budget speech in Parliament, Zulu said the non-payment of SMMEs and cooperatives by government created a barrier to business growth and ultimately to the growth of the economy.

“[It] was one of our worst nightmares,” she said.

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“We believe that unless businesses are paid, it’s a recipe for them to collapse,” she said. “So government has identified this as one of the biggest problems. And it is unfortunate that it’s the very same government that is not paying when people are supposed to be paid.

“Cabinet agrees with us that late and non–payment of suppliers constitutes financial misconduct,” she said in her speech. “We welcome the creation of a special unit by the Minister in the Presidency responsible for Planning, Monitoring and Evaluation that will monitor the implementation of the 30-day payment of SMMEs.”

In her interview she said: “It’s not about just the two departments. It’s about us ensuring that all the departments are held accountable [if they don’t pay SMMEs].”

Unlocking business opportunities

Zulu said a tangible solution to unlocking small business opportunities in South Africa was the set-aside of 30% of state procurement, which entrepreneurs can expect in September.

In her budget speech, Zulu said government will set aside 30% of appropriate categories of state procurement for purchasing from SMMEs and cooperatives.

She said her department would ensure Treasury signs the practice note “that would enable government and ourselves to use that”.

“It’s about accessing opportunities for small and medium enterprises,” she said.

The set-asides would go to “every business person who has a very concrete plan, [and] who can prove and show that their plan has got a capacity for growth, because we want value for money”.

“The 30% in our view is important, because many small businesses do not have access to markets and we think that almost all government departments can be an access to market,” she said.

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