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NATIONAL ASSEMBLY
QUESTION FOR WRITTEN REPLY
QUESTION NO.: 769
DATE OF PUBLICATION: 11 MARCH 2011
Mr N Singh (IFP) to ask the Minister of Economic Development:
Whether the State provides some form of bridging finance to small and
medium enterprises that have been awarded government contracts but still
require cash flow to complete the contracts; if not, why not; if so, what
are the relevant details?
NW837E
REPLY
The State through its agencies, including the Industrial Development
Corporation (IDC) and Khula Enterprise Finance, has provided bridging
finance of about R272m (in the current financial year) to small and medium
enterprises in various industries where they have secured government
contracts.
This involves revolving credit facilities and bridging finance. The
contracts cover areas such as the school feeding scheme programme,
provisions to hospitals, and construction of schools, clinics and
multipurpose centres. The IDC disbursed at least R205 million to small and
medium entrepreneurs to carry out State related contracts from April 2010
to 28 February 2011 through revolving credit facilities. Â
Khula as a wholesale provider of finance and guarantees has through its
financing partners provided R67 million bridging funding support (in the
current financial year) to SMEs that have won contracts supplying goods and
services to the Departments of Basic Education, Health and Public Works,
amongst others.