SEDA boss takes out personal loans to pay employees’ salaries

DURBAN — In a shocking revelation, eThekwini’s Small Enterprise Development Agency (SEDA) CEO Protas Madlala says he was forced to take out multiple personal loans to keep the organization afloat.

“Yes it’s right. I recently took out a personal loan to ensure employees’ salaries were paid on time, and then took out another loan after our electricity was shut off for non-payment. The livelihoods of 60 small businesses on our campus are also at risk when we don’t have electricity, so I had to do something,” Madlala told News24.

“We received no funds from the state coffers for the new year and I simply could not expect my staff and those who depend on our services to be abandoned. Something had to be done.”

The problem, he explained, is the delay in extending the memorandum of understanding (MOU) with SEDA nationally, leaving the organization without re-funding to cover its monthly operating expenses.

“Our offices see people from all over the province because of our high success rates. We are doing this with limited funds from the eThekwini community which supports us with R3m annually and SEDA nationally with R900,000… quarterly.

“One of the biggest challenges we have is that despite the increase in our workload, funding has not increased. We even reached out to the provincial government to help as our services also benefit those outside of eThekwini, but that request was denied,” leaving us with a huge deficit.

“The moral dilemma is that we cannot scare people away as not all SEDA branches are interested in start-up companies, although we have had many success stories in supporting these companies.

“It hurts our staff and customers when they hear we don’t have the money to help them, but they read in the media that government agencies are spending millions of rand over a day or two at social events.”

“The minister never came to our offices”

Madlala said his employees hadn’t received a raise or bonus for three straight years, but remained engaged.

“Just this week we had five buses of visiting students but we needed to do something un-African that we couldn’t even offer [them] Refreshments. I really wish the government could see our work and help increase our funding in some way, or at least get the provincial government involved.”

A SEDA employee, who asked not to be named, also expressed concern about the organization’s funding problems.

“It is unacceptable that our CEO has to take out a personal bank loan to pay our salaries. The government is quick to allocate large sums of money to events whose impact is difficult to measure, while we strive to help more people who are in dire need of our help to become economically independent.

“We tried to get small business owner Lindiwe Zulu to visit us but she never came to our offices to see our hard work.”

Department for Small Business spokesman Linton Mchunu told News24: “The Minister is committed to solving problems, particularly those relating to small businesses, and will make time to visit SEDA when she is in Durban to help.” to address the challenges the organization faces.”

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