South Africa: Minister Ntshaveni Should Fact Check Herself Before She Wrecks Herself (And the Economy)

press release

The Democratic Alliance (DA) call on the Minister of Small Business Development, Khumbudzo Ntshaveni, who is apparently so focused on the importance of facts, to provide not only the DA, but the entire country, with a detailed and up-to-date report that lays out exactly how relief funds allocated to small, medium and micro enterprises (SMMEs) were spent as well as withheld from those both in dire need and deserving of those monies.

This comes after she disputed the DA's claims around her department's dismal allocation of the Covid-19 relief funds for SMMEs. Her attempt to grandstand, rather than address the real issue, failed dismally.

The Minister is not famous for her due diligence when it comes to performing the duties associated with her portfolio. As with any Ministerial portfolio, one such duty, if not the most crucial one, is making sure that one relays the facts to those that pay one's bloated salary.

In fact, relaying the truth to South Africans is not just some unwritten ethical imperative. It is a constitutional duty as per section 195(g) of the Constitution.

It is here, in the realm of distinguishing between facts and fiction for purposes of abiding by the Constitution, where the Minister fails so dismally that her incompetence beggars belief.

The DA recently pointed out that merely R107 million out of a budget of R1.404 billion allocated towards support to qualifying SMMEs affected by Covid-19 has been spent, a meagre 8%.

Whilst these figures are indeed accurate as per page 19 of the Auditor-General's report, it is at this point that we as the DA, a party that takes pride in our adherence to the principles of accountability, transparency, and overall good governance, must admit to our initial omission of three things:

Mentioning that these figures were accurate as of 30 September 2020, as per the Auditor-General's second special report into Covid-19 relief funding, and that any new data produced would inevitably differ due to the time that has since elapsed.

That the abovementioned R1.404 billion excludes a further R360 million allocation to SMMEs that are funded by the Department of Trade, Industry, and Competition through the manufacturing competitiveness enhancement programme, along with savings and reprioritisation across the small business portfolio. Of the latter amount, R202 million has been spent.

Of the total amount of R1.764 billion (R1.404 billion plus R360 million), R308.7 million has been spent in support of SMMEs, equaling 17.5%. Whilst this value is admittedly 9.5 percentage points higher than the 8% reported on page 19 of the AG's report, this is due to the larger proportional disbursement of funds ring-fenced as part of the R360 million, which has the effect of increasing the weighted average of funds spent. Of the R1.404 billion allocation, 92% still remained unspent as of 30 September 2020, however, with total unspent funds thus at 82.5% after including the smaller supplementary allocation.

However, none of this mitigates the Minister's gross dereliction of duty. What is most discombobulating is Minister Ntshavedi's reliance on outdated data from 22 May 2020, as per her own Department's outdated website: dsbd.gov.za.

In her response to the DA's initial press statement along with the letter written to her office to ask that she accounts to the portfolio committee for her omission to execute her duties, the Minister, in a bout of ironic confidence, made the claim that the Department of Small Business Development had only managed to reprioritise R500 million for SMME Debt Relief (she later contradicts herself by stating that it was, in fact, R513 million, as per the aforementioned outdated website).

Yet, the DA never claimed that R1.4 billion was reprioritised for debt relief funding. Instead, the DA merely cited the AG's figure of R1.404 billion that was allocated towards support to qualifying small, medium and micro enterprises affected by Covid-19, as per page 21 of the second special report, notwithstanding a further allocation of R360 million.

Luckily, on page 222 of the AG's report, a condensed breakdown of the debt relief finance scheme is given. As of the end of September of last year, the scheme had a budget of R484 billion, not R513 million, with R290.7 million having been disbursed.

At this point it has to be asked: will the Minister order her own department's website to be updated for the first time in almost 8 months so that it reflects the figures of the Auditor-General, or is the Minister in disagreement with the Auditor-General's findings even though she lays claim to her support in her retaliatory press statement?

Even after our own adjustments of the figures to include the smaller allocation, the facts still do not bode well for the Minister, with 82.5% of funds not having been spent as of September 2020. What makes this all the more worrying is that a recent study by FinFind showed that 42.7% of small business having shut their doors during the first 5 months of the initial lockdown, with 60% of full-time jobs lost, 76.8% of part-time jobs lost, 54.4% of casual jobs lost, and 41.4% of consultant jobs lost. These figures pertaining to job losses also serve to render the Minister's claim to having saved many jobs as misguided at best and downright arrogant at worse.

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