Can DTI improve on their 2010 performance?

As the new year was about to start, the South African Department of Trade & Industry welcomed their new Director General.

Can he make a difference?

During 2010 the DTI's incentives division, The Enterprise Organisation, once again struggled with delays and administrative hitches.

The Incentive Consultants Association, whose members handle the overwhelming majority of all applications and claims under the SMEDP and EIP grant schemes, runs a quarterly survey amongst its members. The survey provides specific numbers and values regarding outstanding grant applications and claims. These surveys show that over the past 5 years, clear trends have been established in respect of the levels of backlogs. Whilst the picture has never been rosy, the trend at one stage was positive. Until about the middle of 2009. From there it has been going downhill again, according to The ICA surveys.

The level of outstanding SMEDP claims, expressed as Rand per industrialist, has deteriorated from R220,000 in September 2009 to R325,000 in August 2010, the worst it has ever been. At that stage close to 50% of all unpaid SMEDP claims (value wise) had been lying on DTI's desks for at least one year, up from 31% at September 2009. That's despite the fact that the SMEDP scheme closed for new applications during 2006 already and will be receiving the very last few claims during 2011.

During September 2009 the ICA survey showed that 47% of all unprocessed EIP applications were older than 3 months. By August 2010 this percentage has increased to 65%

During July 2010 senior DTI officials toured the country to announce the start of EIP claims payment, promising approved applicants that claims would be paid within 1 month. However, by November 2010, members of the ICA reported that hardly any claims had been paid and the average age of unpaid claims was between 4 and 6 months.

It's the year 2011 and we are all looking forward to improvements all round. South Africans are a nation of hope, aren't we?

Theo Meintjes
Managing Director: Dectra

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