JOHN DLUDLU: Wrong diagnosis, and wrong medicine, for spaza shops

At last, the government has acknowledged the obvious — SA’s spaza shops are becoming killing fields of black children. Unfortunately, the interventions are late, and poorly conceived for a problem the government doesn’t really understand. 

On the evening of November 15 President Cyril Ramaphosa announced a raft of measures that will be implemented in a bid to curb further deaths of township and village children at the hands of unscrupulous informal sector traders. 

Among others, he announced a public health education campaign to counter misinformation; the immediate closure of all of the spazas implicated in the more than 20 reported deaths of children; registration of all spazas within 21 days; an inspection blitz starting with Gauteng and KwaZulu-Natal; a R500m fund to support spazas with financial and nonfinancial means; and light regulation of spazas around schools by the start of the new academic year.

Deaths of children under the age of 12 are to become notifiable; joint operational and intelligence structures at national and provincial levels will be established; and, of course, a ministerial health advisory committee will be set up to develop medium- and long-term measures to stop future deaths. The advisory committee will comprise toxicologists, pathologists, paediatricians and “others”. 

In the past two months, Ramaphosa announced, almost 900 people have presented with food-borne illnesses across the country. He also moved to debunk the theory that the poisoning was linked to spazas owned by foreign nationals. The address came at least a month too late, but better late than never. 

Concerns

The number of measures that have been announced creates the impression that the government is taking the issue seriously, but a deluge of measures does not equal effectiveness. In fact, it betrays disturbing concerns. 

There is no evidence that the government has consulted with the critical role players in the ecosystem. The state has several advisory bodies. It also has access to advocacy bodies that work directly with informal sector operators. 

The composition of the announced committees is, in effect, government advising itself. This is clearly problematic given that the public’s trust in the government is at a low ebb, lower than in business and civil society. 

The measures also show poor understanding of a sector that the World Bank calls “unseen”. Insights into this sector and its evolution are important, but this is no time to be educating regulators about the sector’s pain points. This is a time to stop the deaths. 

The 21-day deadline sounds urgent, but it is unrealistic. It assumes that municipalities and the Companies & Intellectual Property Commission have the capacity to execute the registration process. The reality is depressing; there is no such capacity. A case in point is the chaotic process witnessed last week in upgrading electricity meters. In all likelihood the 21-day deadline will be missed, making a mockery of the entire process. 

Also, the registration process appears misguided. A data base is useful to the extent that it can help record the status of the owners of spaza shops. But that is as far as it goes. As during the Covid-19 pandemic, it hardly helped struggling business owners access desperately needed help. It’s unlikely to produce different results this time. 

The R500m fund, which wasn’t mentioned in last month’s mini-budget by the finance minister, would be welcome. But it feels like a drop in the ocean. Details are required about which agency of government will disburse the funds for refurbishment, compliance and so forth. 

Restructuring

The small business development department, the custodian of financial and non-financial support for small business and
co-operatives development, is undertaking a restructuring of its agencies. In terms of this process, which sounds conceptually appealing, the Small Enterprise Finance Agency and the Small Enterprise Development Agency will be merged into one institution to support both small businesses — informal and formal sector — and co-operatives. 

This complex restructuring is proceeding at a snail’s pace, and is being overseen by an interim board. Under the circumstances, it is doubtful that the new entity can provide help on time — assuming money is a problem. 

While the president was clear in highlighting the importance of misinformation and disinformation — including lack of evidence for the conspiracy theory that has done the rounds that there is a co-ordinated poisoning plot against black children — he didn’t address the other elephant in the room.

As part of addressing fears of a foreign food-borne invasion South Africans deserve to know that the proceeds from foreign-owned spazas have not been used for illegal activities in or outside the country. An unequivocal assurance would have helped. 

Setting up a new intelligence gathering structure provides little comfort on this score. South Africans need to know that the existing intelligence agencies, which are overseen by the presidency, are on top of SA’s national security. 

To be clear, this columnist has advocated for regulation of the sector. This includes designating the sector for SA ownership. The announcement a week ago doesn’t go far enough. 

And finally, it is unthinkable that the government thinks it can regulate a sector without the people who work in it, or without empirical evidence. 

• Dludlu, a former editor of The Sowetan, is CEO of the Small Business Institute.