INFORMAL ECONOMY 2012

uMhlathuze Municipality encompasses Richards Bay, Empangeni, eSikhaleni, eNgwelezane, eNseleni, Vulindlela, KwaDUBE, Madlebe, KwaKhoza, KwaMkhwanazi. It has an unemployment rate of 38% and low levels of education and skills (IDP, Statistics SA) SYNOPSIS

First Economy Formal Economy Second / Informal Economy The informal sector is economic activity that is neither taxed nor monitored by a government ECONOMIC DEVELOPMENT FOCUS

It costs approximately R20 million to create a job in big business and R20,000 for small business, and a Negligible amount for informal business

uMhlathuze Municipality has approximately 1, 800 Informal Traders, trading in the following fields: 1. Street or curbside trading 2. Trading in pedestrian malls 3. Markets 4. Trading at transport intersections 5. Trading in Public Open Space 6. Mobile Traders, includes trading from caravans, bakkies, trailers and containers 7. Special events 8. Roadside mechanics 9. Car wash 10. Hair dressers INFORMAL ECONOMY

Generally, informal traders locate at localities where there are high volumes of people or activity at public places or a high number of less affluent households in the traditional “townships” in areas of private land ownership.

Richards Bay CBD: Taxi City Checkers Markets Esikhaleni Shopping Centres: Ntokozweni Esikhaleni Mall eNseleni: eNseleni Rank Meerensee Suburban Mall: LAC Centre Alkanstrand Beach Front AREAS OF TRADE

Empangeni CBD: Empangeni Rail-A Rank Commercial Street Lot 63 B Rank Biyela Street Union Street Maxwell Street Ngwelezane: Ngwelezane Hospital Ngwelezane Taxi Rank AREAS OF TRADE

INFORMAL TRADING REGULATION Provincial Informal Trade Policy, Municipal Bylaws, Informal Trade Policy Institutional Arrangements for Informal Trading: Business Support, Markets & Tourism, Traffic Services, and Environmental Health

Business Support markets and Tourism is a unit under the City Development Cluster. The sub-unit Markets is responsible for coordinating and monitoring of the Informal Economy actors within the city. Maintain and update a database of Informal Traders Conduct a needs analysis Conduct a needs analysis Plan relevant interventions and source funding to assist informal traders, e.g.: Infrastructure upgrade, or new infrastructure Plan relevant interventions and source funding to assist informal traders, e.g.: Infrastructure upgrade, or new infrastructure ROLE OF BUSINESS SUPPORT, MARKETS & TOURISM

Provide basic business training, markets / bulk purchasing, etc. for Informal Traders  Issue of Informal Trading Permits / Renewals Since its inception in 2011 (The sub-unit Markets) has partnered with financial institutions such as ABSA Bank and Standard Bank in offering Financial Literacy and Business Management Skills training. With the assistance of Council’s Spatial Planning the Unit is in the process of identifying additional sites to be demarcated for trading Compiled and Submitted Business Plans for infrastructure Development to COGTA in 2012 for the construction of 250 Trading Stalls Currently reviewing the Informal Trading Policy to align with Provincial Policy …ROLE OF BUSINESS SUPPORT, MARKETS & TOURISM

TRAFFIC UNIT Routine Inspections, Enforcement of Council bylaws ENVIRONMENTAL HEALTH UNIT Routine Inspections Routine Inspections Training in food handling and housekeeping issues Training in food handling and housekeeping issues ROLE OF…

BUSINESS SUPPORT, MARKETS & TOURISM There is a large number of Informal Traders, and currently there are resisting the movement to the formal sector, because of stringent regulation and high cost of overheads. There is a large number of Informal Traders, and currently there are resisting the movement to the formal sector, because of stringent regulation and high cost of overheads. Insufficient manpower in the Unit, even though positions have been created, due to budgetary constraints they remain unfilled. Insufficient manpower in the Unit, even though positions have been created, due to budgetary constraints they remain unfilled. TRAFFIC UNIT There are currently 5 Nuisance Officers, this is not sufficient for the number of traders (1,800), There are currently 5 Nuisance Officers, this is not sufficient for the number of traders (1,800), No follow up when transgressions are reported, No follow up when transgressions are reported, CHALLENGES

…TRAFFIC UNIT No follow up or consequences when fines issued are unpaid No follow up or consequences when fines issued are unpaid No consequences for repeat offenders No consequences for repeat offenders ENVIRONMENTAL HEALTH UNIT Health Inspectors not conducting routine inspections frequently Health Inspectors not conducting routine inspections frequently No follow up on complaints received No follow up on complaints received CHALLENGES

BUSINESS SUPPORT, MARKETS &TOURISM Design an evaluation tool to monitor Traders and determine readiness levels for graduation to the Formal Sector, Design an evaluation tool to monitor Traders and determine readiness levels for graduation to the Formal Sector, Draw up and implement a mentorship programme for Traders that are ready to graduate to the Formal Sector. Draw up and implement a mentorship programme for Traders that are ready to graduate to the Formal Sector. Constantly update the database of Traders Constantly update the database of Traders Filling of the vacant positions, at least one position per financial year. Filling of the vacant positions, at least one position per financial year. WAY FORWARD

TRAFFIC UNIT Additional Nuisance officers required, as the number of Informal Traders is high, and it is growing annually. Additional Nuisance officers required, as the number of Informal Traders is high, and it is growing annually. ENVIRONMENTAL HEALTH UNIT Routine Inspections to be frequent, and Routine Inspections to be frequent, and transgressors to be reported to the Traffic Unit, and follow up be done fortnightly to ensure compliance transgressors to be reported to the Traffic Unit, and follow up be done fortnightly to ensure compliance WAY FORWARD

Business Support Business Support Informal Trading Informal Trading Tourism Tourism Investment Promotion Investment Promotion CONTACT DETAILS

THANK YOU