Government establishing joint fund to support township, rural businesses

Work to establish a R500 million joint fund to support township and rural businesses – including local convenience shops – is underway.

This is according to Minister of Justice and Constitutional Development Thembi Simelane who briefed the media on interventions to mitigate the uptick in foodborne illnesses in South Africa.

She said the departments tasked with overseeing the joint fund are already hard at work drafting standard operating procedures and guidelines on the use and accountability of the fund.

This work is expected to be completed within the next two weeks.

“In the short term, approved rural and township businesses will be supported through this fund to improve their infrastructure, regulatory compliance and capacity building.

“The operational fund application and disbursement process will commence as soon as the registration process is completed and will be subjected to ongoing auditing processes as an early warning system against potential anomalies and fraudulent activities,” she said.

The Minister explained that to qualify for the fund, a business owner must, among others, be “a South African citizen operating within the borders of the country and serving local communities”.

“The business must be registered with local municipality in accordance with the relevant by-laws and have valid registration with SARS. Funding will prioritise entrepreneurs between the ages of 18 and 35 years old with much emphasis on female-owned businesses.

“The Department of Small Business Development has started a process to create a nerve centre with geo-mapping capacity to centralise data on the township and rural economy.

“A national database of registered small businesses and spaza shops will strengthen our capacity to regulate the sector and to ensure effective compliance to avoid the recurrence of future outbreaks,” she said.

Delving further into the issue of the registration of small businesses and spaza shops, Simelane emphasised that lawfully, “every shop owner who is a legitimate trader and meets the legal requirements” is allowed to conduct business.

“In processing these applications for registration, the government will make every effort to ensure that account is taken of every legal prescript that allows people to do business in the country,” she said.

Since the announcement by President Cyril Ramaphosa that all spaza shops must be registered within 21 days, reports have surfaced of South Africans registering these localised shops on behalf of illegal foreign nationals.

This, Simelane said, is a concern.

“This is clear fronting, and we would like to warn everyone who is involved in this illegal activity to stop. The Immigration Act prohibits any person from aiding, abetting, assisting or enabling an illegal foreigner to obtain a licence on his or her behalf, to conduct any business or carry on any profession or occupation.

“Landlords are obliged by law to ensure that those who rent their premises to conduct businesses, comply with the provisions of the Immigration Act and the standard by-laws regulating local business in the municipalities in which they operate,” she said.

Turning to allegations that civil servants are also involved in the fraudulent processing of registrations, Simelane warned that the law would take its course.

South Africans are urged not to interfere with spaza shop registrations.

“The law enforcement agencies will clamp down heavily on extortionists who want to use this process to enrich themselves. Members of the public are urged to report any suspected corrupt activities through the National Anti-Corruption Hotline 0800 701 701.

“We want to appeal to the members of the public not to disturb the process of registration by blocking certain shop owners from participating in the process. This includes conducting unlawful inspections by members of the public, and other unauthorised bodies,” she said.