1. 1. To present to the Portfolio Committee a practical experience of the Kings of Midlands in organising themselves as members of the taxi industry to form their own cooperative, grow their business and develop other enterprises. 2.To assess the relevance of services inherited by the DSBD from Dti to the felt needs of the target group for the Department of Small Business and Cooperatives Development. 1

2. 1. The Portfolio Committee has a responsibility to hold the Department of Small Business and Cooperatives accountable to ensure that it fulfils its mandate. 2. In 2014/2015 financial year the Portfolio Committee asked the Department to do a scientific assessment of the relevance and effectiveness of programmes inherited from Dti to the mandate of the Department and felt needs of SMMEs and Cooperatives. 2

3. 3. The Portfolio Committee has a right to do its own assessment of the relevance of programmes of the DSBD to the mandate of the Department and the felt needs of SMMEs and Cooperatives and use that information in the process of developing a Budget Review Recommendation Report of the Portfolio Committee. 3

4. A cooperative is a group of organised people with organised material and financial resources used collectively against exploitation by the monopoly capital so as to advance the wellbeing of the people. 4

5. South Africa is a mixed economy driven by: 1. Active participation of the State in the economy through State Owned Enterprises. 2. Active participation of the private sector through privately owned companies by individuals and partnerships. 3. Active participation of Cooperatives owned by groups of people and communities with common interests and needs. 5

6. 1. Do programmes inherited from Dti respond to the felt needs of the organised groups of people who have common interests and needs? 2. Is the Department of Small Business Development targeting organised groups and listening to them so as to adjust the programmes of the Department to address the felt needs of SMMEs and Cooperatives. 6

7. 3. Is the Department walking the talk and allocating its budget according to the felt needs of SMMEs and Cooperatives or the Department is addressing perceived needs by officials and consultants that are used by the Department to develop Strategic Plans. 7

8. The most successful cooperatives movement in the whole world is the Mondragon Complex in Spain. Central to the success of the Mondragon is the Caja Laboral Popular or Community Bank which is sometimes called Credit Union. 8

9. Leaders in the Mondragon system freely admit That if they did not have their own banking system, their worker cooperatives could not exist today. In Europe many cooperatives failed over years because traditional private banks were not prepared to support them in difficult times. 9

10. 1. The Mondragon Cooperatives were formed to address poverty and unemployment a similar situation in South Africa. 2. In 1956 five young engineers in the Basque region in northern Spain inspired by the ideas of their former teacher and pastor they borrowed some money and went into production following the principles of democratic decision making, profit sharing and community responsibility. 10

11. 3. From 1975 to 1985 the whole Basque region lost 150 000 jobs. In contrast the Mondragon complex gained 4000 jobs. 4. From the first, the role of the Caja was clear: to utilise local financial resources and invest them in the creation of new enterprises for the development of the Basque region which was suffering from high unemployment. 11

12. 1. They are here to share their story and how the programme of Dti then and DSBD today responded to them. 2. How much did they loose in the process of working with a Dti consultant. 3. What have they done on their own. 4. What enterprises they want to develop to expand their business and create more jobs. 5. What assistance and support they require from the Department and the Portfolio Committee. 12

13. 1. The committee will us the Kings of Midlands Case Study to identify changes that the Department needs to make in order to address the felt needs of SMMEs and Cooperatives. 2. The Department would use this opportunity as a mirror to do it’s own introspection and look at it’s financial and nonfinancial support services it provides to SMMEs and Cooperatives. 3. The Department would begin to respond to the felt needs of SMMEs and Cooperatives. 13

14. 4. The Department would be honest to itself in terms of its own capacity and capabilities to deliver on the mandate. 5. The Department would speed up the process of a joint Strategic Planning Session with the Portfolio Committee and entities that fall under the Department. 6. The Department would assess all programmes inherited from Dti and report back to the Portfolio committee within a specified time y the Portfolio Committee. 14

15. 7. The Department would use the Kings of Midlands and draw lessons from the Mondragon Cooperatives to develop a model that would change the taxi industry from consumer to enterprises development similar to the Mondragon Cooperatives. 8. That the Portfolio Committee would undertake a study tour to Mondragon together with the Kings of Midlands and the Department immediately after local government elections. 15