Trade union Solidarity has slammed the government for creating a crisis funding for small medium and micro-enterprises.
Trade union Solidarity has slammed the government for creating a crisis funding for small medium and micro-enterprises.

Solidarity slams government's SMME fund

By Sandile Mchunu Time of article published Mar 25, 2020

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DURBAN -  Trade union Solidarity has slammed the government for creating a crisis funding for small medium and micro enterprises (SMMEs) in the wake of the Covid-19 outbreak and said it would only benefit black people.  

Solidarity said on Tuesday that it would lodge a complaint with the South African Human Rights Commission (SAHRC) and is preparing for urgent litigation against the government's plans to make crisis funding for SMMEs subject to black economic empowerment (BEE).

Solidarity chief executive Dirk Hermann said it was put unequivocally at a press conference that the assistance from the Department of Small Business Development will only be made available in a “demographically representative” manner and the Department of Tourism has released a document indicating that at least 70 percent of the funds would go exclusively to black controlled companies.

“While the rest of us are indeed bracing for a time of crisis and unprecedented hardship, the government sees it as a golden opportunity to enforce its offensive race ideology. This is appalling,” Hermann said. 

The crisis fund was created to assist small businesses that will be affected as a result of the 21-day lockdown announced by President Cyril Ramaphosa on Monday. 

Small Business Development Minister Khumbudzo Ntshavheni said the fund is aimed at providing relief on existing debts and repayments for SMEs.

“For SMMEs to be eligible for assistance under the debt relief fund, the applicant must demonstrate the direct link of the impact or the potential impact of Covid-19 on business operations. This facility will also assist entities to acquire raw material, pay labour and operational costs. All these interventions will be structured to match the patterns of the SMMEs cash flows as well as the extent of the impact suffered,” Ntshavheni said. 

The SMEs are required to register on the SMME South Africa platform in order to qualify for access to the fund. 

BUSINESS REPORT 

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