​Lerato Mailaone
The draft Township Economic Development Bill is out for public comments until 29 October 2021.
The Bill is part of government's efforts to make starting and formalising a business in the township seamless by loosening red tape and addressing by-laws that constrain the operation of small and medium enterprises (SMEs) and informal businesses in the province.
Once passed, the bill will also make it easier for SMEs to access funding and technical support from government while mandating provincial entities to play a greater role in supporting township businesses.
Gauteng Economic Development MEC Parks Tau who tabled the draft bill in the Legislature on Tuesday said government is legitimately bringing opportunities closer to the people by developing diversified economies.
"We need to create a new, appropriate kind of regulatory environment to unleash the economic potential of our townships, our peri-urban areas, our informal settlements, our abandoned CBDs.
"As it stands, 9 out of 10 township-based businesses do not use a business bank account. They operate outside of regulated space."
The MEC said the multiple shocks of the last year's COVID-19 lockdown regulations hit these businesses and their workers hardest.
"Informal workers have no eligibility for the TERS scheme. Cash-only, uninsured businesses have no recourse to SASRIA. We, therefore, need to create a new regulatory environment for our townships businesses," said Tau.
According to Tau, once approved, the bill will create a new kind of economic geography, known as the township enterprise zones which will be used for "benefit stacking."
"We will target everything government can do at these zones – funding, procurement, better bylaws, tax breaks, dedicated programmes – and in this way we will "stack" the benefits to the people who live and work in these zones, to the businesses who operate there."
For the small township business in these zones, whether formal or informal it will be easier, faster and cheaper to be fully licensed and to tap into the benefits of the formal economy.
"Zoning rules and other laws that have been a barrier to you as a business, have been a problem for you will now be on your side as a business owner. And our ambition is that you will grow as a business and hire people from the township area around you," Tau said.
He said it will be easier for those living in these new township enterprise zones who dream of starting new businesses, of any size, across our 10 high growth sectors.
"This bill will give you access to new kinds of funding and open you up to new markets linked to government and big business," he added​