KwaZulu-Natal businesses impacted by the recent devastating floods can claim assistance to rebuild and restock their premises from a range of government funds.
Speaking in Durban at a KZN Growth Coalition meeting on Thursday, KZN Premier Sihle Zikalala announced a slew of different funds – including grants and loans – that are now available to assist local businesses during the recovery process.
He said at least 826 companies had been affected and the cost of the damages was estimated at R6.4 billion.
“The Department of Economic Development, Tourism and Environmental Affairs (EDTEA) will reprioritise R67.5 million towards SMME/COOPs (cooperatives) relief, which has been approved by Provincial Treasury. The Relief Fund will prioritise township and rural businesses, and informal traders affected by the recent floods,” he said.
Additional flood recovery financial assistance available includes:
* The Department of Trade, Industry and Competition (DTIC) Infrastructure Support Grant aims to provide 50% cost-sharing grant funding to SMMEs and large businesses for the reconstruction of physical and bulk infrastructure inside premises.
* The DTIC Working Capital Grant aims to provide 30% cost-sharing grant funding to SMMEs and large manufacturing businesses. The support includes working capital shortfalls (excluding salaries) as a result of supply chain disruptions, which could result in delayed receipt of raw materials and subsequent cancellation of sales orders.
* The MCEP Industrial Loan Component seeks to assist SMMEs and large manufacturing companies by financing businesses not covered by insurance or by funding the insurance cover shortfall. The fund offers an interest-free loan to affected businesses for the replacement of stock, machinery and equipment, refurbishment of machinery and equipment, fittings, shelving and/or storage facilities, commercial vehicles and material handling systems. It also covers information and communications technology equipment and business development services.
* The Industrial Development Corporation’s (IDC) Flood Relief Fund will finance businesses that are not covered by insurance or have a funding insurance shortfall. Businesses which are fully insured may also be funded through a bridging facility.
* The Flood Recovery Support Grant assists businesses based on invoices limited to 30% of qualifying costs with a capped amount.
* The Infrastructure Fund provides grant funding to businesses for the reconstruction of infrastructure. The scope of the existing infrastructure programme, which has covered companies affected by the unrest, will be broadened to include support for companies affected by the floods.
* Government has also set aside R500m for the Flood Relief Fund to help restore businesses, communities and livelihoods. This covers the recovery process and the rebuilding of affected infrastructure (roads, bridges, water supply, electricity, rail, and commercial buildings). The fund’s support starts from R1m and is capped at R60m per applicant, targeting companies within the IDC’s mandate. Companies outside the mandate, such as traders, retail, logistics, transportation, infrastructure and construction firms will be considered on a case-by-case basis, with the funds limited to R10m per strategic implementing partner (SIP) and R1.5m per business.
* The Funding for Expansion, which relates to the repayment of shareholders/intercompany and related loans, covers companies that have been operational for at least 12 months.
* The Small Enterprise Finance Agency Flood Relief programme is aimed at providing financial assistance to formal small enterprises in KZN and the Eastern Cape. It seeks to help restore businesses, communities and livelihoods. This is a full grant that is non-repayable, providing amounts between R10 000 and R2m per applicant, targeting non-insured and underinsured small businesses.