STATUS REPORT ON ECONOMIC AND EMPOWERMENT AGENDA: COOPERATIVES 2007-2008

1. STATUS REPORT ON ECONOMIC AND EMPOWERMENT AGENDA: COOPERATIVES 2007-2008 PRESENTATION TO THE PORTFOLIO COMMITTEE ON TRADE AND INDUSTRY - 07 NOVEMBER 2007 JEFFREY NDUMO: CHIEF DIRECTOR –COOPERATIVES

3. Background Information • On 05 December 2001, cabinet approved the new mandate for cooperatives development to be transferred from the Department of Agriculture (DoA) to the Department of Trade and Industry (the dti); • Government seeks to promote cooperatives to all the sectors of the South African economy and not only in the agriculture sector, which used to be the case during the apartheid government; • Government’s perspective is that all spheres of government should actively be involved in the promotion and development of co-operatives. This view is embedded within the Cooperatives Act No. 14 of 2005 and policy; and • Co-operatives Act No. 14 of 2005, prescribes that the dti should facilitate effective coordination and reporting mechanism across all spheres of government with respect to promotion of cooperatives in the whole economy.

4. Status on the Cooperatives Act, National Policy and Strategy • During 2004, the Co-operatives Policy that formed the basis for the development of the amended Cooperatives Act was finalised and approved; • The Cooperatives Act, No.14 of 2005 was promulgated into law on the 14 August 2005, repealing the 1981 Cooperatives Act. • The Cooperatives Regulations that ensured the proclamation of the Cooperatives Act on the 02 May 2007, were finalised, allowing for the effective implementation of the Act. • New systems were launched by CIPRO for registration of cooperatives. CIPRO is now working on the decentralisation of cooperatives registration. • The National Cooperatives Development Strategy is a major policy instrument currently being finalised by the dti.

5. Status on the Cooperatives Act, National Policy and Strategy, cont. • Among others, the purpose of the Act is to: • Promote the development of sustainable co-operatives that comply with co-operative principles, thereby increasing the number and variety of economic enterprises; • Encourage persons who subscribe to values of self reliance and self help to register in terms of this Act; • Encourages simpler registration process and management of cooperatives; • Promote equity and greater participation by black persons, especially those in rural areas, women, persons with disability and youth; • Facilitate the effective co-ordination and reporting mechanism across all spheres of government through the dti; and • Ensure development of support programmes by all spheres of government.

7. Coordination with other National Departments • Thedti, as the custodian of the cooperatives programme, established the Interdepartmental Committee to coordinate cooperatives development activities and programmes with key national departments. • 20 national departments were invited to participate in the committee • 18 departments responded to the call and are attending meetings on a quarterly basis. Environmental Affairs and Forestry and Statistics SA never responded. • The coordination is aimed at ensuring that compliance with the requirements of the Act takes place from all the departments in terms of formulating strategies and programmes design to support cooperatives. The departments share experiences as well as report progress in this regard.

8. Status on Provincial Cooperative Strategies The Cooperatives Act, No.14 of 2005 legislates that all spheres of government design and implement support measures for cooperatives. Coordination with the respective departments rest with the dti to ensure fulfillment of these requirements

9. Status on the formulation of Provincial Cooperative Strategies, cont. The Cooperatives Act, No.14 of 2005 legislates that all spheres of government design and implement support measures for cooperatives. Coordination with the respective departments rest with the dti to ensure fulfillment of these requirements

10. Status on Financial Support for Cooperatives

11. Status on Financial Support for Cooperatives, cont. • Cooperative • Incentive • Scheme (CIS) • 2006 to 2007: THE ENTERPRISE ORGANISATION (TEO) • 90:10 matching grant for start-up; • Investment disbursed R4 million to 16 cooperatives; • 303 members of cooperatives received jobs; and • CIS has been transferred to TEO to administer and rollout. • Cooperative • Special Project • Fund (CSPF) • 2006 to 2007: COOPERATIVES DEVELOPMENT UNIT • Grant and loan mixed facility; • Provide start up and expansion capital assistance • Investment disbursed R8 million to 4 small to medium cooperatives; • Substantial jobs created; and • CIS has been transferred to Khula to administer and rollout.

12. Status on Access to Markets support • SMME & • Cooperatives • Targeted • Procurement • Programme • (set asides) • Designated 10 products approved by cabinet to be rolled out to other departments and provinces. • 30 days payment • For SMMEs and • Cooperatives • Measures for 30 day compliance approved by cabinet to be rolled out to other departments and provinces.

13. Status on Non-Financial Support for Cooperatives, cont.

14. Status on Non-Financial Support for Cooperatives, cont.

15. Status on Support for Cooperatives from other National Departments The Cooperatives Act, No.14 of 2005 legislates that all spheres of government design and implement support measures for cooperatives. Coordination with the respective departments rest with the dti to ensure fulfillment of these requirements

16. Status on Support for Cooperatives from other National Departments The Cooperatives Act, No.14 of 2005 legislates that all spheres of government design and implement support measures for cooperatives. Coordination with the respective departments rest with the dti to ensure fulfillment of these requirements

17. Status on Support for Cooperatives from other National Departments The Cooperatives Act, No.14 of 2005 legislates that all spheres of government design and implement support measures for cooperatives. Coordination with the respective departments rest with the dti to ensure fulfillment of these requirements

18. Status on Support for Cooperatives from other National Departments The Cooperatives Act, No.14 of 2005 legislates that all spheres of government design and implement support measures for cooperatives. Coordination with the respective departments rest with the dti to ensure fulfillment of these requirements

19. Status on Support for Cooperatives from other National Departments The Cooperatives Act, No.14 of 2005 legislates that all spheres of government design and implement support measures for cooperatives. Coordination with the respective departments rest with the dti to ensure fulfillment of these requirements

20. Status on Support for Cooperatives in Provinces

21. Status on Support for Cooperatives in Provinces

22. Status on Support for Cooperatives in Provinces

23. CHALLENGES • Some provinces, national departments and institutions do not have budget dedicated or ring-fenced for cooperatives. • Some provinces, national departments and institutions do not have programmes dedicated for cooperatives • Some national departments e.g. Labour do not participate in the intergovernmental committee and report on progress has not been received. This will be corrected in the future. • Leadership challenge: coordinationcommittees sometimes are effected by poor attendance. • Leadership challenge: Economic Development departments in provinces have not yet assumed leadership roles in coordinating for support for cooperatives in those respective provinces. To be corrected in the future.

24. WAYFORWARD • Strengthening of the existing coordination committees (i.e. interdepartmental; provincial committees). • Establishment of coordination committee with all development institutions (financial and non-financial). • Assistance of provinces in establishing their coordination committees with other departments and provincial institutions. • Clear reporting of progress to be emphasised in committees. • Finalisation of the national cooperatives strategy and implementation of proposed programmes. • Technical assistance to provinces in finalisation of their strategies. • Technical assistance to national departments in development of cooperatives sector policies/strategies/programmes.

25. THANK YOU