Beruflich Dokumente
Kultur Dokumente
ON THE
RESTRUCTURING OF THE
SMALL AND MEDIUM
ENTERPRISES DEVELOPMENT
AUTHORITY
JUNE 2013
Report on the Restructuring of the Small And Medium Enterprises Development Authority
TABLE OF CONTENTS
1.0
2.0
INTRODUCTION
1.1
Background
1.2
Terms of Reference
1.3
Methodology
AUTHORITY
3.0
4.0
5.0
2.1
2.2
Operations
2.3
2.4
2.5
SMEDA Services
10
3.1
11
3.2
11
13
4.1
13
4.2
Financial Performance
13
4.3
14
16
5.1
16
5.2
16
5.3
17
5.4
18
6.0
20
7.0
22
8.0
CONCLUSION
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
1.0
INTRODUCTION
1.1
Background
body
established
under
the
Small
and
Medium
Enterprises
Development Authority Act 2009 to make better provision for the promotion and
development of small and medium enterprises. This Act repealed and replaced the
Small Enterprises and Handicraft Development Act 2005 under which the Small
Enterprises and Handicraft Development Authority (SEHDA) was created following
the merger of the Small and Medium Industries Development Organisation
(SMIDO) and the National Handicraft Promotion Agency (NHPA).
SMEDA
operates under the aegis of the Ministry of Business, Enterprise and Cooperatives.
1.1.2 The new legislation provides new definitions for small and medium enterprises on
the basis of turnover (a small enterprise less than Rs.10 M, and a medium
enterprise between Rs.10 M to Rs.50 M). As per the SMEDA Act, the SME
definition includes enterprises in all economic sectors. In order to avoid detailed
sector-specific criteria, turnover criteria is used across sectors i.e. no
differentiation between services and manufacturing sectors has been made for
small enterprises, and the thresholds for small manufacturing firms also reflect
small service firms.
1.2
Terms of Reference
1.2.1 The Office of Public Sector Governance (OPSG) has been requested to provide
support to parastatal bodies in collaboration with line Ministries, in the preparation
of their restructuring plans. SMEDA has been identified as one of the parastatal
bodies needing a restructuring plan in 2013 with an objective of reaching a 5%
return on its capital investment. The restructuring plan needs to be approved by
Cabinet before the end of the year so as to meet the KPI of the European Union.
1.3
Methodology
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
1.3.1 For the purpose of this assignment the following methodology and approach have
been adopted:
(i)
Meeting and discussions with the Managing Director and staff of the SMEDA.
(ii)
(iii)
(iv)
(v)
(vi)
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
2.0
2.1
2.1.1 The Small and Medium Enterprises Development Authority (SMEDA) operates
under the aegis of the Ministry of Business, Enterprise and Cooperatives and
provides support and facilitates the development of entrepreneurship and SMEs in
Mauritius. SMEDA is governed by a Board whose mission is to establish SMEDA
as the institution to promote, serve, support and strengthen SMES to face up the
challenges of globalization.
2.1.2 The objectives of the SMEDA are, among others, to promote a conducive business
environment and empower SMEs to emerge and grow; provide a service delivery
network which increases the contribution of SMEs in the national economy and
enhances economic growth; enhance the competitiveness of SMEs; to devise and
implement development support programmes and schemes for SMEs; and to
facilitate, assist and provide the necessary support to SMEs to gain market access
and business opportunities and to compete successfully in the national and
international markets;
2.1.3 The functions of the Authority as provided by Section 5 of the Act are as follows:
(i) Provide core support services, particularly entrepreneurship development,
business facilities, counseling and mentoring services;
(ii) Implement and operate a registration scheme for SMEs;
(iii) Facilitate access to industrial space, finance and other productive
resources;
(iv) Empower product specific and sector specific SMEs to enhance their
delivery capabilities;
(v) Coordinate with other support organizations and stakeholders in the
fulfillment of its objectives;
(vi) Facilitate networking among SMEs and the development of linkages
between large enterprises and SMEs
(vii) Promote technological and management capabilities of SMEs;
Office of Public Sector Governance
(OPSG)
Prime Ministers Office
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
in
seminars,
workshop
and
capacity
building
programmes;
(xiv) Identify projects for the development and promotion of SMEs;
(xv) Facilitate and coordinate research relating to the development of SMEs;
(xvi) Sensitize the public at large on entrepreneurship;
(xvii) Provide incubator facilities for SMEs;
(xviii) Devise and review policies relating to SMEs;
(xix) Coordinate initiatives of public sector agencies and of the private sector
relating to SMEs;
(xx) Coordinate entrepreneurship activities carried out by public sector
agencies and the private sector.
2.1.4 The major services to be provided comprise, inter alia, adequate and appropriate
support and assistance by SME support institutions to enterprises, dissemination
of information and awareness of SMEs on available support as well as facilitation
of enterprises through ease of doing business. The performance indicators for the
SME sector for 2013 under the Ministrys PBB are the preparation of 50 business
plans for start ups and industries
Office of Public Sector Governance
(OPSG)
Prime Ministers Office
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
2.2
2.2.1 The activities of the Authority are carried out by the six divisions namely: Business
Development, Training and skills Development, Marketing and Promotion,
Business Support; Administration and Finance, and Documentation and Research
Centre.
2.2.2 The priority objective for the SME sector according to the PBB Document
Estimates 2013 and Indicative Estimates 2014 & 2015 would be to increase share
of SMEs contribution to the GDP. However, no percentage has been given for the
expected increase in GDP. The CSO Census of Small Establishments released in
2007 revealed that 92,000 SMEs employed 209,000 persons and accounted for
20.8% of GDP. Accordingly, the sector accounted for around 41% of total
employment and generated a gross output worth Rs.42.1 bn. The next census is
underway.
2.2.3 The operations of SMEDA involve primarily the provision of core support services
to
SMEs,
particularly
entrepreneurship
development,
business
facilities,
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
2.2.5 The SME Resource and Technology Centre (SRTC) enables entrepreneurs to
obtain the necessary information on business ideas, new technology, and sourcing
of raw materials, amongst others.
2.2.6 Other programmes have been launched at the SMEDA incubator Centre to
supplement the existing activities of SMEDA. These are the Start-Ups
Entrepreneur Scheme, the Digital Literacy Programme and Cloud Computing,
Creative Craft Incubators in Ceramics and Pottery, Pyrography, Silk Painting,
Fashion and Design, Coconut Craft, Wood Craft/ Sculpture, Painting on Wood and
Ship Models.
2.3
2.3.1 The vision of SMEDA is to be the centre of excellence for servicing SMEs.
Whereas its mission is to establish SMEDA as the institution to promote, serve,
support and strengthen SMES to face up the challenges of globalization.
2.4
2.4.1 The SMEDA is administered by a Board known as the Small and Medium
Enterprises Development Board, which consists of a Chairman and Members of
the various Ministries responsible for the subject of SMEs, Finance, Industry,
Cooperatives, Environment, Youth and Sports, as well as from these organizations
directly related to the promotion and development of small and medium
enterprises. The Managing Director is the Chief Executive officer responsible for
the execution of the policies of the Board and for the control and management of
the day-to-day business and activities of the organization. She is supported in her
task by officers of various cadres.
2.4.2 SMEDA head office is at Coromandel and operates an office at Curepipe, Rose
Belle, Triolet, Bon Accueil and a branch in Rodrigues.
2.5
SMEDA Services
2.5.1 SMEDA provides a variety of services to the SMEs but with little success. SMEDA
should not aim at servicing all the 100, 000 SMEs because it is simply not feasible
Office of Public Sector Governance
(OPSG)
Prime Ministers Office
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
and not cost effective and lot of them will survive and prosper without the support
of SMEDA. It should rather concentrate on those which need badly its assistance
and provide them all round support for them to grow. With the phasing out of the
duty free and tax rebate to SMEs registered with SMEDA, less entrepreneurs are
inclined to seek registration. SMEDA should move closer to the entrepreneurs
instead of expecting them to come to its head office at Coromandel.
2.5.2 SMEDA should be able to establish its priority sectors and use the information
available at the Registrar of Companies on new enterprises being registered and
monitor them closely especially at the infant stage.
2.5.3 There is a need to define the micro enterprise which should obviously become the
major clients for SMEDA, small and medium already defined in the Act.
2.5.4 Table 1 below shows that SMEDA, during the last 7 years, has been able to
register some 2000 new SMEs a year, out of which an average of 640 were still in
operation. This gives an indication that mortality rate is very high that 2 out of 3 do
not survive.
Table 1: Small and Medium Enterprises registered during the period 2005
2012
Enterprises
In
Operation
2005
473
886
262
69
New
Total
New In
Registered Registered Operation
2005 - 2012 2012
2012
1884
2357
607
1819
2705
670
236
498
98
72
141
26
Total in
Operation
2012
1081
1556
360
95
46
62
108
28
74
476
990
1466
373
849
67
63
130
27
94
251
338
589
126
377
764
2274
3038
788
1552
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
Occup
Trade & Commerce
Business Support
Service Sector
Others
Total
1463
67
5054
158
6517
225
1431
48
2894
115
338
5,162
866
13,816
1204
18,978
248
4,470
586
9,632
(Source: SMEDA)
3.0
3.1.
MANAGING DIRECTOR
Director
Manager (1)
Business
Development
& Support (V)
Manager (1)
Manager
Administratio
(1)
Andetailed
Organi Training &
& Finance
Skills Dev.
Manager (1)
Marketing
&Promotion
(Research Unit)
3.1.2 The four Managers are responsible for the following operations:
Assistant
Manager
Assistant
Research
UnitManager
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
3.1.3 The technical staff comprises only of twelve Business Development Officers and
seven Extension Officers. Out of the 100 staff on the establishment of SMEDA,
nine staff are posted in Rodrigues. It has been reported that the posts of some
fifteen staff who are over fifty would be phased out as per the last PRB report.
These comprise the post of Director and other Extension Officers, amongst others.
3.1.4 As a general rule, an organisation should be staffed in such a way that two third or
more of its workforce are involved directly in the core functions of the organisation.
Staffed involved in supporting services should be at the minimum. At SMEDA, the
opposite may apply.
Officers and 7 Extension Officers and they are expected to service the SMEs
across the island. The remainder is doing office or other duties.
3.2
3.2.1 The present bulky and heavy structure of the SMEDA is the result of the merger in
2005 of the then Small and Medium Industries Development Organisation
(SMIDO) and the National Handicraft Promotion Agency (NHPA) into the Small
Enterprises and Handicraft Development Authority (SEHDA). This SEHDA was
renamed SMEDA with enactment of the new law on small enterprises in 2009.
3.2.2 Prior to the merger SMIDO had 45 employees and NHPA had 67 and SEHDA was
set up with all these employees without any attempt to propose a conducive
structure for the SEHDA for it to deliver according to its redefined mandate as
provided in the Act. The International Development Partners (IDP) Ltd in its report
on the merger proposed a reduction of 48 employees but apparently was not acted
upon. A new Act was proposed in 2009 to set up the SMEDA and again the
institutional capacity weaknesses were not addressed. In the meantime, 4 CEOs
were appointed to revamp the institution but with mitigated success.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
3.2.3 The number of staff at the SMEDA and there age analysis is depicted in table 2
below.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
18-30
yrs
41-50
yrs
2
2
51-60
yrs
60 +
yrs
Total
1
1
1
1
3
5
2
1
1
1
3
1
1
1
1
7
1
4
1
1
12
2
1
1
1
1
1
1
1
1
1
4
3
1
2
1
8
7
1
2
7
1
1
1
4
3
7
(Source: SMEDA)
31-40
yrs
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14
2
1
24
1
1
3
4
33
1
4
5
29
1
2
6
6
1
7
1
1
13
12
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
4.0
4.1
4.1.1 All assets and funds of the former Small Enterprise Handicraft and Development
Agency (SEHDA) have been vested in the Small and Medium Enterprises
Development Authority (SMEDA). It has thus received total assets worth of Rs 92
million from the SEHDA including Cash at Banks amounting to Rs 38.9 M. The
Authority has received grants from Government to the tune of Rs.34 M for the
financial years 2010, 2011 and 2012 and the same amount has been earmarked
for the years 2013, 2014 and 2015.
4.2
Financial Performance
4.2.1 The financial performance of the SMEDA for the last three years 2010 to 2012 is
shown in table 3 below:
Table 3: Financial performance of SMEDA for the period 2010 - 2012
Financial Year
Revenue
Other Income
Total Income
Administrative Expenses
Other Operating Expenses
Deficit
2010
35.8
10.5
46.3
(36.1)
(16.2)
(6.0)
2011
49.2
11.7
60.8
(34.5)
(27.8)
(1.6)
2012
36.8
12.5
49.4
(33.0)
(25.7)
(9.4)
(Source: SMEDA)
4.2.2 SMEDA has realised losses to the tune of Rs 6.0M, Rs 1.6M and Rs 9.4M for the
years 2010, 2011 and 2012 respectively. The major cost of the Authority is staff
cost which accounts for around 70% of total cost.
4.2.3 SMEDA is late with the preparation of its Financial Statement, the latest audited
accounts were in respect of the year ending December 2010.
4.2.4 SMEDA during the last few years was not given the level of grants asked for to
maintain its operations. As a result it had to use its own reserves to finance its
budget. With Government willingness to shift its support from institutions to SMEs
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
directly, this is not expected to change. Table 4 below illustrates the budget
discipline imposed by MOFED.
Table 4: Budget discipline of the SMEDA
SMEDA
Approved
SMEDA
Total
Proposals
by
Reserve
Budget
2007-08
2009-09
2009 (6 mths)
2010
2011
2012
2013
Rs M
49.8
50.5
37.5
70.6
69.5
63.5
51.7
MOFED
Rs M
22.0
33.5
15.0
34.0
34.0
34.0
34.0
Rs M
13.5
8.3
9.6
13.0
13.0
11.0
6.0
Rs M
35.5
41.8
24.6
47.0
47.0
45.0
40.0
(Source: SMEDA)
4.3
4.3.1 SMEDA operates 4 shops where handicraft products of SMEs are sold at a profit.
In addition to the Airport, it has shops at Caudan, Mahebourg and Rodrigues. It
has made surpluses averaging to Rs 6 million during the last 3 years. Table 5
below shows the sales per shop for the period 2010-12, the airport shop being the
highest performing and practicing 100% mark up on its products.
Table 5: Turnover generated by the handicraft shops of the SMEDA
Airport
Caudan
Rodrigues
Other shops
Total
2010
Rs M
10.6
0.9
0.1
0.6
12.2
2011
Rs M
13.7
1.3
0.2
0.5
15.7
2012
Rs M
13.4
0.8
0.2
0.8
15.1
(Source: SMEDA)
4.3.2 SMEDA has just closed certain shops at Grand Bay, Astrolabe and Chamarel
which were found to be underperforming. It is now planning to open new shops in
shopping malls and major hotels. Given the large number of tourist visiting the
Office of Public Sector Governance
(OPSG)
Prime Ministers Office
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
country, SMEDA is expecting this measure will help to boost its sales in the years
to come.
4.3.3 SMEDA should ensure that the operation of each shop is profitable, that is a
minimum level of sales should be achieved to cover all its cost as a cost centre.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
5.0
5.1
5.1.1 Small and Medium Enterprises remains an important segment of the Mauritian
economy as they contribute significantly to wealth creation, employment
generation and poverty alleviation. It is established that SMEs, being labour
intensive, require less investment for job creation than large firms.
5.1.2 It is estimated that SMEs in operation are around 140,000 and are contributing
around 37% of our GDP, some 120 billion rupees worth of output and are
employing around 250, 000 people. However, there were only some 18,978 such
enterprises registered with SMEDA as at December 2012.
The number of
enterprises in operation was 9, 632 and they were employing 25,942 people. It is
estimated that around 15% of SMEs are registered with the SMEDA.
5.1.3 SMEs are operating in wide ranging sectors from food and beverages; leather and
garments, wood and furniture; paper products and printing, chemical, rubber and
plastic, handicrafts, pottery and ceramic, jewellery and related items to trade and
commerce.
5.1.4 The sectors in which the SMEs are operating are already experiencing
unprecedented challenges as a result of trade liberalization in line with the
globalisation process, the WTO regulations and the dismantling of safety nets
(Multi-fibre Agreement, Sugar Protocol). This situation is further aggravated by
very tough competition from imported and imitated products from low cost
countries in particular China.
5.2
5.2.1 According to operators in this sector, SMES are faced with constraints relating to
finance, skilled labour, training facilities, marketing, business development
services, infrastructure, technology and institutional support framework.
The
schemes for SMES are dispersed among too many support institutions (SMEDA,
NICE, NWEC, DBM, EM and MBGS). This is creating confusion among SMEs and
Office of Public Sector Governance
(OPSG)
Prime Ministers Office
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
5.3
5.3.1 There are a number of institutions which have been set up by Government over
the years to provide support to SMEs under different ministries. These institutions
even if they have attracted large amount of resources have not necessarily
delivered as expected. These institutions are illustrated below and a matrix
showing the services provided by SMEs by the various agencies is at Annex I.
5.3.2 SMEDA has been set up to provide better support to SMEs. It receives some Rs
34 M subsidies a year and its services have limited impact due to the fact that it
does not possess the right skills to deliver according to its mandate.
5.3.3 Enterprise Mauritius which operates under the Ministry of Commerce and Industry
is promoting mainly export oriented industries. It does have a SMEs desk and
provide technical assistance to SMEs contemplating the export market.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
5.3.4 National Women Entrepreneur Council operates under the Ministry of Gender
Equality and has a Division working with women entrepreneurs. It also does
counseling and refer SMEs to SMEDA for further technical support.
5.3.5 Development Bank of Mauritius operating also as an SMEs bank providing
financing to SMEs through a number of SMEs schemes. Its procedures are
reportedly too cumbersome for small entrepreneurs. As a result, subsidies
channeled to SMEs remain grossly unutilized.
5.3.6 Mauritius Business Growth Scheme has just been set up under MOBECC to
finance new businesses including SMEs with good business plan. It has been
structured and staffed with people with skills in business analysis.
5.3.7 There is a pressing need to coordinate the activities of the various SMEs
supporting agencies. Initially, there was an ambitious project to merge together all
the major SMEs supporting institutions (DBM, SMEDA, NWEC) under one roof
and under MOBECC. This could not be achieved. Then the setting up of a Board
to coordinate the activities of all of them were proposed under the UBEB ( Unified
Business Enterprise Board) where they will all be represented. This also could not
be achieved. Now an Inter Agency Committee (IAC) has been set up under
MOBECC to streamline the services offered to SMEs by the different agencies.
This committee is expected to propose a coordinated action plan for SMEs support
by September 2013.
5.4
5.4.1 Over the years, Government conscious of the difficulties of small enterprises to
find funding for their projects, has developed a number of schemes for SMEs.
Commercial banks find such projects too risky for them. As a result, many
programmes have been proposed and administered across a range of public
sector institutions.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
business development. The NRF, funds specific projects while the operating costs
(salaries, rent, utilities) of the various implementing agencies are paid through the
annual budget. The NRF is currently supporting 22 different schemes, the majority
of which are schemes of financial support (loan guarantees, equity participation,
debt restructuring).
5.4.3 These funds meant for SMEs financing remain largely unknown to them. SMEDA,
here, has a role to play. It should counsel all its SMEs on the various financing
opportunities and help them to tap these resources.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
6.0
6.1
SMEDA in the future should have 4 divisions, each one headed by a Manager and
organised as shown in the Chart below. The 5 posts of Assistant Managers should
be phased out over the years.
BOARD
GENERAL
MANAGER
GANAGING
DIREGENE
RALCTOR
BUSINESS
DEVELOPM
ENT
SERVICES
RESEARCH &
DEVELOPME
NT
BFCT
Admin/IT
Research
Handicraft
BDS - on
contract
Finance
Training
Shops
Procuremen
t
Statistics
Promotion
Regional
Offices
6.2
ADMIN &
FINANCE
HAHNRDRA
FH
HANDICRAF
T
NDICRAFTH
HH
HR
Fairs
SMEDA should have a dedicated division for Handicraft which will also be
responsible for the shops and marketing activities.
6.3
SMEDA appears to be a bulky organisation. This is mainly due to the result of the
merger with the National Handicraft Promotion Authority some seven years back. It
has now too many grades with complex reporting lines. It should aim at a leaner
and more flexible structure and becomes a performing organisation. Its size should
drastically be reduced to attain an optimum structure.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
6.4
The IDP Report, at page 38, has already identified 35 posts that are no longer
required and this is still valid. SMEDA should use this as a basis to redefine its
staffing structure.
6.5
6.6
Certain minor grades can be merged together to promote multiskilling and at the
same time provides more flexibility to management. There is an urgent need to
recruit a Human Resource Officer who should, as a priority, streamline the grades
and update all the scheme of services.
6.7
SMEDA needs staff with the required skills for it to deliver according to its mandate
as provided by Section 5 of the Act. These skills may either be recruited or
outsourced or combination of both. There is an urgent need to recruit more
Business Development Officers. Thus, it is recommended that 12 Business
Development Officers be recruited on contract.
6.8
6.9
The Human Resource Officer, once recruited, should as a priority address the
issues mentioned above.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
7.0
7.1
Enhance Board Composition too many Ministries representatives
7.1.1 The present Board appears weak in terms of entrepreneurial skills and knowledge.
There are too many Ministries representatives (5 out of 13) who contribute little in
furthering SMEDAs objectives. More people with entrepreneurial/ business
background need to be present on the Board.
7.2
Strategic Plan and Action plan
7.2.1 The Act 2009 provides at Section 21 that the Board once set up should prepare a
year strategic plan and an action plan for the new SMEDA. This has never been
done. SMEDA should consider this as a priority if it wants to have a real impact on
the SMEs sector. Many of the measures proposed in this Report can find their
way in the new strategic plan of SMEDA.
7.3
Introduce Annual Performance Agreement with Parent Ministry
7.3.1 SMEDA should be more performance oriented. It should, henceforth, agree with its
parent ministry in advance on its performance targets for each year. OPSG can
provide guidance on this exercise which is also provided for by the Codes of
Corporate Governance for state owned enterprises.
7.4
Rightsizing of SMEDA
7.4.1 SMEDA is a heavy organisation with more than 100 employees. The previous
SMIDO was operating with only 45 staff. SMEDA should aim at reducing its
staffing strength to 70 after taking into account recruitment of additional technical
staff.
7.5
Reduction in non-technical Staff
7.5.1 SMEDA should aim at reducing gradually its workforce. The 35 employees
identified by the IDP Report as surplus to requirement should be removed.
Employees going on retirement should not be replaced, it can consider
redeployment of unrequired employees to other Government Bodies as recently
done for the setting up of the MCIA at the Ministry of Agro-Industry and finally
propose an early retirement scheme for those who may instead opt for leaving
their jobs.
7.6
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
7.6.1 SMEDA even if it is oversized lacks the necessary skills in house to allow it to
deliver according to its mandate. There is a need with the proposed reduction in its
workforce to increase in parallel the number of Business Development Officers
within the same budget level. 12 BDOs may thus be recruited to provide more
support to SMEs.
7.7
20 Business Consultants funded by National Resilience Fund or MBGS
7.7.1 SMEDA should start with the registration of Business Consultants to counsel and
support SMEs. Professionals and degree holders with knowledge on business
and experience should be invited to register themselves with the SMEDA. Thus,
20 Business Consultants to be funded by NRF can immediately be recruited on
contract. Each one will have a SMEs portfolio which will be monitored by SMEDA
staff. The object should be to take on charge 500 SMEs especially smaller ones
and help them to grow in the next three years and this can easily be measured in
terms of business turnover and job creation. This will cost Rs 10 million a year. A
project proposal form is at Annex III.
7.8
Setting up of Research Unit
7.8.1 The Research Unit being set up should be able to identify new business
opportunities
sector
wise
and
advise
entrepreneurs
on
new
business
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
and other local authorities halls can be used for this project. This project if,
successfully implemented, may have a tremendous impact in the development of
the SMEs sector and at little cost.
7.10.2 The financial projection of SMEDA for the next 4 years, taking these reforms into
consideration, is shown at Annex IV. It shows that SMEDA, in addition to
improving significantly its services to SMEs, will move from a loss making position
to generate a 5% return on its Equity as from 2015.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
8.0
Conclusion
8.1
SMEDA should focus on start- ups, micro and small enterprises which have a
huge potential for growth and work with them to expand and become strong
businesses and be prepared to explore the export market if necessary. Thus, it will
have more success stories to show and use them to promote entrepreneurship in
the country. It should also start rewarding the highest performing entrepreneurs in
each sector. The end result should be a stronger and thriving SME sector in
Mauritius.
8.2
Once the SMEDA has been successfully restructured, Government can consider,
as a second phase, bringing all the SMEs supporting institutions under a single
roof to achieve maximum efficiency.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
Annex I
Matrix of Services
Provided by the
SERVICES
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
Major
SMEDA
Business Counselling
Business plan elaboration
Provision of management training
Provision of technical training
Registration, leading to preferential
treatment
Entrepreneurship development
Business fora
Development of sub-sector strategies
Marketing advice, market intelligence
Participation in trade fairs
Access to finance
Research & Development support
Research and future projects
Common facilities
Advocacy, lobbying
Joint venture promotion
Export promotion
Access to Business Development
Services
Financial support to start-up
entrepreneurs
Mentoring/Coaching/Handholding
services
Networking / Clustering
Company Diagnostic / Capability
Assessment
Innovation / Creativity
Instituti
ons
MBGS
Unit
EM
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NWEC
DBM
Report on the Restructuring of the Small And Medium Enterprises Development Authority
Annex II
Schemes for SME Support
1.
2.
3.
4.
Scheme
Objective
Implementing
Agency
Eligibility Criteria
Funds
earmarked
Mauritius Business
Growth Scheme
(MBGS). Start up
Entrepreneurship
Scheme
Mauritius Business
Growth Scheme
(MBGS) Technical
Assistance 90-10
Payback Scheme
Market Development
Support
Monthly support of up to
Rs 20, 000
Mauritius
Business Growth
scheme unit
(MBGS)
Rs 700m (for
both MBGS
and Start Up
Entrepreneurship
Scheme)
To facilitate growth in
private sector economic
activity
MBGS Unit
Support participation in
international trade fairs
by manufacturers (both
SMEs and non-SMEs)
To provide financial
assistance to SMEs
which are:
Enterprise
Mauritius
Enterprises already
exporting and those
which are export
ready
1. SMEs with
turnover less than
Rs 50m
Rs 400m
Participation in
International Fairs
SME Refund Scheme
for SMEs only
5.
Fair Trade
Development
6
.
Lease Financing
Scheme
7.
SME Financing
Scheme
8.
9.
1. Already exporting or
export-ready meet part
of expenses
2. Attending or visiting
fairs
3. Linked to technology,
sourcing of raw materials
or other specialized fairs
Support to co-operatives
in obtaining Fair Trade
certification
To assist SMEs to
acquire equipment to
modernize their
operations
To assist SMEs in
raising finance from
commercial banks to
meet their working
capital needs and their
expansion as well as
create new jobs
To provide assistance to
financial assistance to
SMEs
Enterprise
Mauritius
2. SMEs in
Manufacturing and
Agricultural sector
Maximum Refund
at
Rs 200,000 per
year
irrespective
of the number of
trade fairs
participated
EM & MOBEC
SMEs having one
years operation
Restructuring
working groups
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29
Maximum leasing
amount
of Rs 10m
Maximum of Rs
200,000
per year
irrespective of
number of trade
fairs
the enterprise
participates in.
Maximum of Rs
200,000
per year,
irrespective of the
number of trade
fairs
the enterprise
Report on the Restructuring of the Small And Medium Enterprises Development Authority
participation
in. A grant of up
to
Rs 20,000 for
freight expenses
incurred.
10 Freight Refund
.
Scheme
Enterprise
Mauritius
Companies with an
annual turnover of
less than Rs 50m
which are already
exporting - ready
Enterprise
Mauritius
12 Access to industrial
.
space
To provide industrial
space to SMEs at
affordable rates across
the island
To finance projects of
small enterprises
Development
Bank of Mauritius
14 Business
.
Development
Schemes
To finance projects
Development
Bank of Mauritius
11
.
International Bids
Refund Scheme
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30
Rs 150,000
maximum loan
amount
75% of project
cost
up to a ceiling of
Rs 5m
Report on the Restructuring of the Small And Medium Enterprises Development Authority
Annex III
Small and Medium Enterprises Development Authority - SMEDA
Project Recruitment of 20 Business Consultants
Recruitment of 20 Business consultants to help a portfolio of 500 small enterprises grow
into medium and financed by NRF.
The project duration is 3 years and will be financed by the National Resilience Fund. A
sum of Rs 10 M will be required yearly for consultants fees. A consultant fees is expected
not to exceed Rs 50,000 a month.
Consultants will be recruited by SMEDA after registration of potential professionals with
knowledge and experience in enterprise management.
The Business Consultant will be responsible for a portfolio of 25 small enterprises in a
particular region and help them to double their turnover over a period of 3 years.
They will be responsible for the following duties KEY DUTIES:
1.
2.
To carry out site visits to provide assistance, guidance and support SMES through regular
follow-up, coaching and mentoring so as to enable the SMEs to expand their business.
3.
To advise SMEs on new business opportunities, emerging customer needs and new
marketing strategy
4.
To advise SMEs on efficiency gain throughout the value chain activities to improve the
competitiveness of their product/service
5.
To examine operational problems faced by SMEs and advise them on how to overcome
these constraints.
6.
7.
To carry out surveys, collect data and prepare reports on the performance of the SMES.
8.
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
ANNEX IV
2013
2014
2015
2016
Rs M
Rs M
Rs M
Rs M
Rs M
Revenue
Shops sales
Govt. Grant
Other Income
Grant from NRF
15.1
35.7
1.0
-
16.0
35.0
1.1
-
18.0
40.0
1.2
10.0
20.0
40.0
1.3
10.0
22.0
40.0
1.4
10.0
Total Revenue
51.8
52.1
69.2
71.3
73.4
8.5
36.0
10.7
9.0
40.5
10.0
10.0
31.0
10.0
11.5
32.0
11.0
13.0
32.0
11.0
10.0
10.0
10.0
4.5
4.5
4.8
3.0
Total Expenditure
(55.2)
(59.5)
(68.5)
(69.0)
(70.8)
Surplus/(Losses)
(3.4)
(7.4)
0.7
2.3
2.6
4%
12%
13.6%
Expenditure
SMEs products purchased
Salaries & Wages
Other operational Cost
20 Business Analyst
(contract)
Recruitment of 12 BDOs &
others
Redundancy Cost
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Report on the Restructuring of the Small And Medium Enterprises Development Authority
years. At the end of this period, enterprises with Turnover below Rs 5 M should be
doubled and those above Rs 5 M should show at least a 50% increase.
3. 35 employees will be removed from the payroll as from 2014 through either
redeployment or early retirement. A provision of Rs 3 M has been made as
incentives for the employees above 55 who may opt for early retirement.
4. 12 Business Development Officers, one Accounts Officer, one Internal Control
Officer and one Human Resource Officer will be recruited (after early retirement or
redeployment of the above mentioned 35 employee) to provide the SMEDA with
the right structure.
5. Under new arrangement, SMEDA can register more enterprises in priority sectors
by using more effectively its access to the Companies Division Register for new
businesses, prepare some 100 business plans a year and monitoring visits should
be increased tenfold given that proximity with the entrepreneurs is the key.
6. The SMEDA with the reforms proposed will be able, in addition to perform at a
higher level, shows surplus from its operation as from 2014 and a 5% return on its
Equity as from 2015.
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