Categorized | Cooperatives, SMMEs

30% state procurement to motivate small businesses


For years small businesses have been complaining that they are at the tail end of the government procurement value chain. Hence, to address their plight, in his State of the Nation Address, President Jacob Zuma announced that government was to specifically reserve 30% of state procurement for small micro-medium enterprises, co-operatives and township and rural enterprises.

In what business analysts as a “landmark” development, Zuma said: “If we are going to drive sustainable economic transformation, there has to be measures and programmes in place for government to support business – in particular black business.”

Bearing in mind the persistent challenges of translating good economic policies into tangible action, Zuma has tasked the new BEE council to take stock of progress to be made. Thus, he explained that the members would ensure that, as part of their on-going monitoring and evaluation, the B-BBEE [Broad-based Black Economic Empowerment] framework continued to attract foreign investment through the Equity Equivalent Programme.

The preferential procurement figure means that small scale service providers have to deliver quality services and products within time frames prescribed in tender documents. This has been a challenge for most black-owned businesses for years.

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