Rebate scheme misses the mark for small business energy relief
14 August 2023
The DA notes National Treasury’s announcement last week that it has officially launched the Energy Bounce Back Loan Guarantee Scheme (EBB) – an initiative it claims will alleviate the impact of continuing damage resulting from unreliable power supply for small businesses and households.
While the energy crisis devastates the small business sector, the solution presented by Government is woefully inadequate as the scheme's design raises serious concerns.
Small businesses that are already burdened by existing debts and the precarious economic environment, may find the prospect of taking on additional loans, even with a government guarantee, untenable, especially if investments in alternative energy sources fail to yield the expected returns. Moreover, the administrative complexity of the EBB may exclude micro and small businesses and inadvertently favour those businesses with existing banking relationships and financial expertise. This will exacerbate economic inequalities within the sector.
This situation is unacceptable. Minister of Small Business Development, Stella Ndabeni-Abrahams, who is entrusted with protecting small businesses from predatory practices, has remained conspicuously silent on this rebate initiative. Her failure to speak out or provide updates on the "energy relief package" she promised on the 18th of January this year is deeply concerning.