Small Business Development Committee Welcomes Progress on Red Tape Reduction Framework

The Portfolio Committee on Small Business Development has welcomed the progress made by the Department of Small Business Development in developing the Red Tape Reduction Framework. The committee received a briefing on the department’s progress during its meeting on Wednesday.

The framework, which addresses the regulatory and administrative challenges faced by micro, small and medium enterprises (MSMEs), aims to establish a systematic approach to reducing bureaucratic barriers across all spheres of government.

While commending the department for its efforts, the committee emphasised that the effectiveness of the framework would be significantly strengthened through the introduction of dedicated legislation to govern red-tape reduction.

In line with recommendations made by the National Planning Commission (NPC), which briefed the committee two months ago, committee members reiterated their view that a Red Tape Reduction Bill should be tabled in Parliament for consideration.

Committee Chairperson Ms Masefako Dikgale said: “The framework alone will be unenforceable across all spheres of government without the necessary legislative mechanisms to ensure its effective implementation.”

The framework proposes that the Minister of Small Business Development be responsible for its oversight, supported by an advisory council to guide implementation.

The committee has urged the department to expedite the finalisation of the framework, noting that the absence of standardised red tape reduction measures currently costs South African businesses an estimated 6.5% of gross domestic product (GDP).

Per Kind Favour of APO

Africa Fact: The Africa Development Bank estimates Africa’s infrastructure needs amount to $130-170 billion a year, with a financing gap of $68-108 billion a year.
Africa Fact: 42 of the 49 Sub-Saharan African countries have the regulatory framework in place to allow private investment in infrastructure.