MBOMBELA – The premier Mr David Mabuza confirmed this during an oral question-and-answer session in legislature on November 20, in reply to Mr Cleopas Maunye, Bushbuckridge Residents’ Association MPL, saying that there are no plans to dismantle the Mpumalanga Economic Growth Agency (MEGA). While the entity was not performing as required, it needed to change instead of being made redundant, Mabuza said.
“Notwithstanding the challenges faced by some of the provincial public entities, MEGA is part of the government’s service-delivery machinery. The objectives for which MEGA was established, remain relevant. The power to give out loans is important. We should not throw it away. Instead we must try to change the structure and the people.”
During this financial year until October, MEGA had approved only two business loans totalling R500 000 and five housing loans valued at R1,5 million. No loans relating to agricultural activities were approved during this period.
Mabuza explains, “MEGA is faced with cash-flow constraints which are influenced mainly by insufficient revenue as well as poor debt collection. Agricultural loans could not be funded as planned since the budget was based on a fund which was withdrawn.”
He said transforming the entity into a centre of excellence was not an overnight exercise. “Any new organisation needs time to mature.”
The entity has managed to create 660 job opportunities in Ehlanzeni District Municipality, more than in the other two districts combined.
It has also completed the three bulk-water projects it retained after handing the rest to Rand Water due to its slow pace of delivery, and have delivered them to Nkomazi and Lekwa municipalities.
He said it was concerning that MEGA had outsourced its own turnaround strategy. He added that MEGA had requested that the bad debt it had accumulated, due to small businesses failing and being unable to repay their loans, be written off. He said it was necessary to relax loan conditions “otherwise some people living in townships will not be able to get a loan”.
“It is our intention to support small business. We have to support, guide and mentor them to success. That is where I think we as government have lost it.”
In response to a follow-up question from the EFF’s Mr Collen Sedibe, on how the entity was tasked with placing the province on a sustainable growth trajectory if it spent R1 billion irregularly in 2013/14 according to the Auditor General, Mabuza said the responsibility to drive growth and create employment did not lie with MEGA alone but with all government institutions and social partners.
