Ann Bernstein, the executive director of the Centre for Development & Enterprise (CDE), is calling for the Department of Small Business Development (DSBD) in South Africa to be shut down. She argues that the department has not achieved its goals of supporting and growing small businesses, despite spending R6 billion annually. Bernstein says that the DSBD has become a drain on state resources.
The administrative and bureaucratic costs of running the department have not been justified by its results. She points out that small businesses in South Africa still face many challenges, such as limited access to finance, complicated regulations, and not enough support services. Instead of keeping the DSBD, Bernstein suggests using the money for programs that would directly help small businesses.
These could include tax breaks, simpler regulations, and making it easier for small businesses to get funding through existing financial institutions.
Calls to shut down DSBD
She believes this would be a more efficient and direct way to support small entrepreneurs.
Bernstein’s comments have led to a lot of discussion among business leaders and policymakers. Some agree with her, noting that the DSBD has overlapping responsibilities with other government departments, which creates redundancy and inefficiency. Others argue that the DSBD should be reformed rather than eliminated.
Economists have also joined the debate, discussing the wider implications of closing a government department. One economist said, “It’s important to consider whether the department has strategic value and if it can be reformed to better serve its purpose. Getting rid of it without addressing the underlying issues could lead to gaps in support for small businesses.”
The debate continues as South Africa tries to find the most effective way to support its small business sector, which is a critical part of the country’s economic future.
Bernstein emphasizes the need for urgent action, saying, “We’re in deep, deep trouble, and just doing what we’ve always done, or carrying on with reform in a hesitant, slow manner is not sufficient.”
Photo by; Andy Feliciotti on Unsplash
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