Research on the Performance of the Services Sector

The Policy and Strategy Framework for Developing Small and Medium Enterprises in the ICT Sector

This section provides an overview of the policy and strategy framework for developing small and medium enterprises in the ICT sector. This overview includes a discussion on the National and Provincial policies and strategies that are relevant to the ICT sector. The relevant support and development programmes have also been included in this section.

National Support Programmes, Policies and Strategies to support SMEs in the ICT Sector

The National Communications Act 2005

The Electronic Communications ACT 2005 is aimed at deregulating the telecommunications sector and although it is primarily a licensing framework, it also promotes the entry of SMMEs into the sector⁶⁰. The Electronic Communications Act of 2005 was developed for the following:

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  to promote convergence in the broadcasting,
  
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  broadcasting signal distribution and telecommunications network services and broadcasting services;
  
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  to provide for the granting of new licenses and new social obligations;
  
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  to provide for the control of the radio frequency spectrum,
  
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  to provide for the continued existence of the universal service agency and the Universal Service Fund, and to provide for matters incidental thereto⁶¹.
  

ICT Policy

The Department of Communications in South Africa is responsible for ICT policy and strategies and is in the process of formulating further policy framework to guide the sector’s development.

There are three principles for ICT policy⁶² and these are:

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  Develop ICT policies and legislation that support the development of an ICT sector that creates conditions for accelerated and shared growth of the South African economy, which positively impacts on the wellbeing of all our people and is sustainable.
  
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  Develop strategies that increases the uptake and usage of ICTs by the public, thus maximizing the impact of the ICTs in service delivery, nation building and social cohesion as well as creating conditions for better life for all.
  
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  Provide a base for informed, timely, forward-looking and proactive ICT policy decision making in the Department and sector as a whole to evaluate the impact of those policies, laws and strategies on improving lives of South Africans.
  

The Department of Communications has also established a number of strategic projects which aim to achieve some advances in the ICT Sector. These programmes form part of the medium term strategic plan for the department, and include the following⁶³:

Programme 1: Governance and Administration- provide strategic support to the ministry and overall management of the Department

Programme 2: International Affairs and trade- to ensure alignment between South Africa’s international activities and agreements in the field of ICTs with South Africa’s foreign policy.

Programme 3: ICT Policy Development- Develop ICT policies, legislation and strategies that support the development of an ICT sector and develop strategies that increase the uptake and usage of ICTs by the majority of the South African population.

Programme 4: Finance and ICT Enterprise Development- to oversee and manage government’s shareholding interest in public entities and to facilitate growth and development of Small, Micro and Medium Enterprises (SMMEs) in the ICT sector.

Programme 5: ICT Infrastructure Development- to promote investment in robust, reliable, secure and affordable ICT infrastructure that supports the provision of a multiplicity of applications and services.

Programme 6: Presidential National Commission- to facilitate the development of an all-inclusive information society by promoting the uptake and usage of ICTs for improved socio economic development and research.

5.9. Development and Support Programmes on a National Level

National government offers various programmes and development support initiatives to small businesses within ICT and across various sectors in South Africa.

The Department of Trade and Industry (dti) has a number of initiatives and SME support and development programmes in place. The dti’s SMME development programme which aims to support Small, Medium and Micro Enterprises- prioritizing entrepreneurship and growth and development in the industry. This applies to all industries, including ICT. Furthermore, the Enterprise Organisation is a project of the dti which offers funding to promote the growth of small businesses. There are many initiatives and programmes which are project- specific- each offer specific services to specific types of business. For example, the “Black business supplier development programme” offers funding to majority black owned businesses, “business process outsourcing & off shoring” offers investment and training to businesses with offshore clients, “critical infrastructure programme” offering cash grants upon completion of an infrastructure- developing project , “co-operative incentive scheme” offers grants to emerging co-operatives, preferably benefitting underprivileged communities, “enterprise investment programme” offers investments to manufacturing companies , “film production incentive” offers a package of incentives to encourage the film production industry in South Africa, and “Sector specific incentive scheme” offers generic funding grants to develop industries overall (ICT services industry falls under this). Many of these projects can be utilized to benefit ICT industries in different ways.

Seda along with other national departments offer programmes and support to ICT businesses. The Seda Technology Programme (STP), is a merger of many small enterprise support agencies for the ICT industry; including the GODISA trust, the National Technology Transfer Center, dti business incubators, Technology Advisory Center, Technology for women in business and the South African Quality institute’s support programmes. The STP is a dti programme, offering financial and non-financial support to ICT businesses; business incubation, facilitating technological innovation and increasing access to technology and quality technical support services.

The International Development Corporation (IDC) also offers support to developing SMEs in South Africa. The IDC has an ICT Business Unit which focuses on the development of businesses which rely on ICT technologies. They provide funding and support to projects in the ICT Sector; IT, Telecommunication, E-waste, electrical and electronic manufacturing etc. Focus is put on sustainable businesses which create jobs and develop rural communities and society.

Collectively, these programmes aim to achieve sector growth and advancement, by establishing a platform that can allow companies in the sector to compete at an international level.