Image: WCG Red Tape Reduction Unit

The Red Tape Reduction Unit makes it easier for businesses to thrive in the Western Cape, by growing our economy and creating more jobs. The amount of red tape and bureaucracy faced by businesses when dealing with government restricts economic development and growth. Creating an enabling environment for business is, therefore, fundamental to creating a competitive economy.

Research shows that red tape costs South Africans R79-billion per year. This is equivalent to 6,5% of GDP, or 16,5% of the total wage bill in 2003 (Small Business Project (SBP) 2005).

Red tape is defined as:
  • non-essential procedures, forms, licences, and regulations that add to the cost of dealing with government; or
  • anything obsolete, redundant, wasteful or confusing that diminishes the competitiveness of the province, which stands in the way of economic growth and job creation or wastes taxpayers’ time and money.
Red tape interferes with:
  • the ability of businesses to compete in a global marketplace as a result of unnecessary costs and/or delays;
  • the rate of establishment of new businesses; and
  • the sustainability and/or growth of existing enterprises.

The Red Tape Reduction Unit was established by DEDAT in 2011. Its main objective was to remove bureaucratic blockages to make it easier and more cost-effective to do business in the Western Cape. The Unit follows a two-pronged approach in tackling bottlenecks in the business environment:

  • reactive through its response to cases lodged to the unit; and
  • proactive, which seeks to identify legislation and processes that represent barriers to business or efficiency in government, and designing interventions that cut across an entire industry sector or several processes.

The outcome of the interventions must impact on the cost of doing business in terms of reducing either time, costs or complexity. To date, the unit has dealt with almost 8,000 business and red tape related matters. It maintains a resolution rate in excess of its 85% target.

The WCG made Regulatory Impact Assessments (RIAs) standard practice for new policy and legislation. Cabinet has approved it as a mandatory requirement for all significant legislation and policies. We are the first and only province to elevate RIA to this level. The Red Tape Reduction Unit has partnered with sister departments to improve business-facing processes. This benefits business process improvement (BPI) projects, such as the Department of Transport and Public Works (tourism signage and abnormal load permit applications) and Agriculture (export related processes, permit applications and auditing). Several BPI project possibilities with national departments are being explored as well.

The potential for making it easier, cheaper and faster to do business in the province is huge, considering the many approvals, licences and authorisations that businesses need to operate.

For more information on the Red Tape Reduction Unit please visit  https://www.westerncape.gov.za/red-tape-reduction/