Briefing by the Small Enterprise Development Agency (Seda) to the Portfolio Committee on Small Business Development 10 September 2014 Sipho Zikode, CEO (Acting )

 Delegation Details.  Acronyms.  Legislative Framework Governing Seda.  Context to SMME Policy Framework.  SMME Policy Framework.  Vision and Mission.  Seda’s Strategic Objectives.  Seda’s Target Market.  Products and Services.  Seda’s Operating Model.  Seda’s Delivery Network.  Seda’s Staff Complement.  Revenue and Expenditure (in Millions).  Seda’s Budget per Economic Classification.  Performance on Strategic Indicators. Presentation Outline 1

Delegation Details 2 NameDesignation Mr. Sipho ZikodeChief Executive Officer (Acting) Mr. Lusapho NjengeChief Strategy and Information Officer

Acronyms CPPP Community Public Private Partnership dsbdDepartment of Small Business Development dtiDepartment of Trade and Industry NamacNational Manufacturing Advisory Centre SAQISouth African Quality Institute Seda Small Enterprise Development Agency SMMESmall Medium and Micro Enterprise Stp Seda Technology Programme TWIBTechnology for Women in Business CRM Customer Relationship Management 3

Legislative Framework Governing Seda  Seda was established in December 2004 through the National Small Business Amendment Act, 29 0f 2004, under the dti, and now under the dsbd through a merger of various institutions and programmes such as Ntsika, NAMAC, CPPP, SAQI, Godisa and the technology related activities of TWIB.  Seda’s mandate is to:  Implement national government’s small business strategy.  Design and implement a standard and common national delivery network that must uniformly apply throughout the Republic in respect of small enterprise development.  Integrate all government funded small enterprise support agencies across all tiers of government. 4

 When South Africa achieved democracy in 1994, it inherited an economy with inter alia the following characters:-  A racialised economy dominated by monopolies;  A closed economy;  An economy based on exclusion, with the majority of citizens having been excluded from participating; and  High unemployment and underemployment.  There was no comprehensive policy and strategy on small business development.  As a response, a White Paper on National Strategy on the Development of Small Business (The White Paper) in South Africa was published in 1995, so as to foster small business development. Context to SMME Policy Framework 5

 The White Paper provided for the following measures:-  The creation of an enabling Legal Framework and Streamlined regulatory conditions;  Facilitation of access to information, finance, procurement, and market access;  Facilitation of access to affordable physical infrastructure and other business development services;  Facilitation of access to appropriate technologies; and  Introducing differential taxation and other business development and financial incentives.  The above continues to be given effect through a combination of Policy Formulation, Programme Development and an Institutional Framework for Small Business Development. Context to SMME Policy Framework 6

 Amongst the key Policies formulated was the National Small Business Act of 1996 which was amended in  The above Act inter alia established Seda and the mandate to provide coordinated services, programmes and products to enhance competitiveness and capabilities of small enterprises.  The Integrated Strategy on the Promotion of Entrepreneurship and Small Enterprises (ISPESE) was published in  This Strategy is aimed at strengthening the SMME sector through promoting entrepreneurship, strengthening the enabling environment and enhancing competitiveness and capabilities at enterprise level. Context to SMME Policy Framework 7

SMME Policy Framework 8

 Vision – To be the centre of excellence for small enterprise development in South Africa  Mission – To develop, support and promote small enterprises to ensure their growth and sustainability in coordination and partnership with other role players  Values – Nurture, Innovation, Customer Service Excellence, Ethical Behaviour, Resilience (NICER)  Goal – Ensure that the small enterprise sector grows and increases its contribution to sustainable and equitable social and economic development, employment and wealth creation 9 Vision and Mission of the Organisation

Strategic Objective 1: Enhance competitiveness and capabilities of small enterprises through coordinated services, programmes and projects. Strategic Objective 2: Ensure equitable access to business support services. Strategic Objective 3: Strengthen the organization to deliver on its mission. Seda’s Strategic Objectives 10

Potential entrepreneurs All potential and existing small enterprises as defined by the National Small Business Amendment Act, 29 of Seda’s Target Market 11

For survivalist and micro enterprises Entrepreneurship awareness Franchise awareness Business start-up training Business planning Business registrations Business start-up advice For small and medium enterprises Access to local markets Access to export opportunities Incubation Access to technology Quality and standards testing, advice and implementation Hotline to assist with late payment of SMMEs Business mentoring Facilitation of access to finance For collectively owned enterprises Social facilitation and mobilisationCooperatives development and registration Access to local marketsAll other relevant products and services still apply For people with disabilities Programmes with MODE, DeafSA and SANCBAll other relevant products and services still apply Seda’s Service Offerings 12

BuildGrow Operational Phase Research and idea generation Phase Planning and Formalisation Phase StartTalk Meet Partner Network Seda Network Clients Seda CRM Seda Tools Seda Learning Academy Seda SMART System Support Processes Seda’s Operating Model 13

Seda Provincial Network ProvinceSeda Branches Seda Satellite Offices Seda Supported Incubators Co- location Points Mobile Units Info Kiosks EC FS GT KZN LP MPU NC NW WC TOTAL

Number of Staff Members Contract Staff Number of vacancies Total Posts Vacancy Rate as % of Total Posts National Office % Provincial Network % Total % Seda Staff Complement 15

Revenue and Expenditure (in Millions) 16 INCOME FY 13/14 (Audited)FY 14/15FY 15/16FY 16/17FY 17/18 Seda - DTI from MTEF budget 457,8 498,3 527,5 556,3 583,2 STP - DTI from MTEF budget 119,2 126,4 132,2 138,3 146,1 External earnings 51,8 34,8 35,0 8,9 Other income 12,3 8,1 7,9 8,0 8,1 TOTAL INCOME 641,1 667,6 702,6 737,6 746,3 EXPENDITUREFY 13/14 (Audited)FY 14/15FY 15/16FY 16/17FY 17/18 Compensation of employees 224,2 257,2 275,2 294,4 315,1 Goods & Services 378,9 393,7 410,7 426,7 414,8 Depreciation 13,0 14,8 14,9 Interest 2,1 1,9 1,8 1,6 1,5 TOTAL EXPENDITURE 618,2 667,6 702,6 737,6 746,3

Seda Budget per Economic Classification 17

 More than 96% of assisted small enterprises have indicated satisfaction with quality of Seda services over the past four years.  Approximately 36% of surveyed small enterprises reported an increase in number of people employed and approximately 66% reported an increase in turnover as a result of Seda interventions each year, over the past three years.  Seda Technology Programme has created in excess of 10,300 direct jobs over the past six years.  Seda currently has 43 operational partnerships across all three tiers of government, the private sector, the public sector and international organisations.  Facilitated the operationalisation of over 100 primary cooperatives and over 30 secondary cooperatives each year for the past three years.  SMME Payment Assistance Hotline has facilitated over R380 million in payments since inception. Performance on Strategic Indicators 18

Performance on Strategic Indicators 19

Performance on Strategic Indicators 20

Thank you