The informal sector is an important part of the economy, contributing to the social and economic development of countries. A contributing factor to this may be that the management of the sector is not properly institutionalized.
INTRODUCTION
Every economy consists of two sides, the formal economy and the informal economy. Some countries, on the other hand, have adopted a more proactive approach to dealing with some sectors of the informal economy.
RATIONALE FOR THE STUDY
This is because policy is actually a management tool that an institution can use to regulate some kind of behavior (Greene. This is because policy is a management tool that can help an institution effectively solve any social problem.
PROBLEM STATEMENT
The crucial role of the municipality is to balance the need for business retention and expansion of formal businesses, as well as supporting the informal business sector as a means of eradicating poverty and creating jobs. What programs are currently implemented or planned for the management of the informal business sector.
OBJECTIVES OF THE STUDY
What is the current political environment in Polokwane Municipality regarding the management of street vendors. Determine the support street vendors need to perform better and contribute to the city's economy.
LIMITATIONS AND DELIMITATIONS OF THE STUDY
Looking at the city of Polokwane and one of the administrative groupings, it was felt that it would give a good picture of what is going on in terms of business dynamics in the municipality. The samples may not be fully representative of the population due to the non-probability sampling method used.
RESEARCH APPROACH
Literature Survey
Empirical Research
Literature consisting of books, articles, magazines, legislation as well as policy was studied and analyzed to fully understand the research problem. After collection, the data was analyzed and a report prepared showing the narrative matrices as well as graphs, to highlight the findings as well as the recommendations of the study.
CLARIFICATION OF CONCEPTS
Public Institution: Any institution established by the government to provide goods or services to members of the public. Small enterprises: enterprises with fewer than 50 employees as classified by the 1995 National Strategy for the Development and Promotion of Small and Medium Enterprises in South Africa.
STRUCTURE OF THE STUDY
Introduction and Background of the Study
Public Administration and Transformation of Local Government
Policy Development and Management in the municipal environment
Nature and characteristics of the informal business sector
Informal economy - The South African context
Street vending - Case Studies
Polokwane Municipality’s environment
Furthermore, various programs and projects are examined to determine the rationale and the likely impact that such interventions may have on the management of street trading in the municipality. Images showing the extent of informal trading (especially street vending) are also included to paint a visual picture of what is happening in the municipality.
Research Methodology
Presentation and Analysis
Conclusion and Recommendations
CONCLUSION
This chapter has introduced the subject of the research, providing a background for the research as well as the purpose of the study. The next chapter explores the concept of public administration and focuses on the South African democratic government's efforts to transform local government to make it more developmental in line with the provisions of the South African Constitution.
INTRODUCTION
The chapter further examines how local government in South Africa has developed since the apartheid regime to the present, with the adoption of the constitution and other policy documents. The concept of development-oriented local government, as expressed in the White Paper on Local Government (1998), is analyzed.
PUBLIC ADMINISTRATION
- Definition
- Accountability
- Historical Perspective
- The Classical Approach
- Neo-Classical Approach
- The Contemporary Approach
Cloete simply defines public administration as the various activities carried out to establish and run public institutions. The evolution of public administration is interesting because it has indicated that some of the challenges that public institutions faced in the past still persist.
CONSTITUTIONAL MANDATE
When developing policy, the influence of the environment (with regard to inputs and outputs) must be taken into account. Certain groups enjoyed all the benefits at the expense of the majority of the population (Cloete, 1995: 1).
TRANSFORMATION OF THE PUBLIC SERVICE IN SOUTH AFRICA
It should further ensure that (community) needs are met regardless of race, gender and economic status, as was the case in the past. Furthermore, it means that during the development of such a policy, representatives of the public should be consulted so that they can contribute their opinion.
LOCAL GOVERNMENT
- Transformation of Local Government in South Africa
- Period: The 18 th to the 19 th century
- Period: 1900-1983
- Period: 1984-1994
- Period: 1995-2000
- Developmental Local Government
The first phase (pre-intermediate phase) would be the period from the adoption of the Local Self-Government Transition Act to the elections. Between the adoption of the constitution and the democratic local elections, the Transition to Local Government Act (209 of 1993) was amended to deal with issues such as rural local government, financial matters, the abolition of provincial demarcation boards and so on (Craythorne, 2003: 13) .
INTEGRATED DEVELOPMENT PLANNING
Notified by Sections 152 and 153 of the Constitution, Chapter 5 of the Municipal Systems Act (32 of 2000) instructs municipalities to undertake development-oriented planning (Municipal Systems Act 32 of 2000). In general, the IDP must enable the municipality to promote social and economic development as per Article 195 of the Constitution.
LOCAL ECONOMIC DEVELOPMENT (LED)
It is therefore the responsibility of the local government to understand how the economic environment is structured in order to develop interventions to strengthen its potential and address its challenges. Local government is responsible for creating an environment that leads to the creation of jobs.
CONCLUSION
Even in the past, the apartheid value system manifested itself most powerfully in local government. The White Paper on Local Government (1998) provides approaches that councils can follow to promote LED.
INTRODUCTION
Thus, it focuses on the policy development process and the policy cycle, which provides a framework for the policy cycle. This presentation will provide a basis for policy development recommendations to manage the informal business sector.
DEFINITIONS
According to Botes et al, policies are systematic actions that must be taken to achieve goals. There should be a clear objective or goal to be achieved after the policy is implemented.
CATEGORIES OF PUBLIC POLICIES
- Distributive, Redistributive, Self-regulatory and Regulatory Policies
- Substantive and Procedural Policies
- Material and Symbolic Policies
- Policies Involving Public Goods or Private Goods
The objective of the policy will partly determine the type of policy that will be developed, as explained in the next paragraph. Regardless of the problem to be addressed, policies are not developed in a vacuum.
HIERARCHY OF POLICY STATEMENTS
- Political Policy level/Political Party Policy
- Political Implementation Policy/Government Policy
- Administrative Executive Implementation Policy/Departmental Policy
- Operational Policy/Administrative Policy
As the primary policy maker, it is the political office bearer's responsibility to provide the officials in his department(s) with instructions to follow - meaning that he is the master and the public official is an instrument (a secondary policy maker) of used in public policy.". For example, informed by the spirit of the RDP, the 1995 White Paper on the National Strategy for Small Business Development and Promotion in South Africa was developed as a government policy.
FACTORS WHICH INFLUENCE POLICIES
- External Factors
- Internal Factors
This implies that the administrative policy developed must be in line with and informed primarily by the policy of the ruling political party. d) Activities and representation of interest groups. Public institutions are created to achieve political goals, and therefore policies must be informed by the policies of the ruling party.
POLICY-MAKING PROCESS
- Agenda Setting
- Policy Formulation
- Policy Adoption
- Policy Implementation
- Policy Evaluation
Upon adoption, a policy must be implemented to change the undesirable situation that prompted the development of the policy. It is therefore important to also indicate how the results of the assessment will be processed further.
PUBLIC PARTICIPATION IN POLICY-MAKING
Accordingly, section 195(10(e)) of the Constitution asserts that the needs of the people must be responded to and the public encouraged to participate in policy making. While most actors are likely to be given the opportunity to participate in the process, the population (who directly benefits), interest groups and individuals are likely to be sidelined/bypassed.
IMPLICATIONS FOR THE MUNICIPALITY
This provision requires officials to consult members of the public because, as Kotze and Kellerman (in Kotze argue), community participation is a means of achieving sustainable development. The Council's policies must be in line with the policy position of the ruling party, both the national government and the provincial government.
CONCLUSION
Overall, it indicates that the political environment will play an important role in determining the policies that are developed in terms of what will be done, how it will be done and what the desired outcome should be.
INTRODUCTION
Case studies are analyzed to assess how the sector manifests itself in other countries and how it is managed. Furthermore, it must be recognized that the existence of the sector cannot be attributed to a single cause.
BACKGROUND
It has also been observed that informal sector employment grows during periods of economic crisis (Chen, Vanek & Carr, 2004: xiii). It has also been observed that during periods of economic crisis, employment in the informal sector increases.
DEFINING THE CONCEPTS: INFORMAL SECTOR AND INFORMAL ECONOMY INFORMAL ECONOMY
The definition of the informal sector during the early days only referred to the activities undertaken by enterprises. In the past, there was the belief that the informal sector was not permanent, that it would disappear.
LINKAGES BETWEEN THE FORMAL ECONOMY AND INFORMAL ECONOMY ECONOMY
In this view, growth in the formal economy depends in part on growth in informal enterprises. These people end up working in the informal economy when they cannot be absorbed by the informal economy.
CHARACTERISTICS AND NATURE OF THE INFORMAL ECONOMY ECONOMY
It is also important that strategies and policies improve the working conditions of participants. The discussion will now look at the state of the informal economy in different countries.
CASE STUDIES
- Latin America
- Central and Eastern European Countries
- Asia
- Advanced Industrialized Countries
As manufacturing expanded and created jobs, the informal economy declined in countries such as Japan, the Republic of Korea, China and Singapore. In countries such as Great Britain, Belgium, the participants in the informal economy were young, skilled men.
LESSONS FROM THE CASE STUDIES
The European Commission has adopted a policy entitled Communication on Undeclared Work to tackle the informal sector (ILO, 2002a: 23). On the other hand, informal productive enterprises can also grow during periods of economic boom due to the increased need for goods and services by the formal sector.
FACTORS AFFECTING THE INFORMAL ECONOMY
- Legal and Institutional Frameworks
- Economic Growth
- Economic Policies and Economic Climate
- Poverty
- Demographic Factors
In Asian countries, for example, the informal economy grew during the economic crisis of the 1990s. But it is a fact that people accept unattractive jobs in the informal economy because of poverty.
POLICY IMPLICATIONS
- Regulating the informal economy
- Formalisation of the informal economy
- Promoting informal businesses
- Improving informal jobs
- Recognising the voice of informal workers
- Mainstreaming Governance
The contribution of the informal economy as a source of people's livelihood and economic growth is important. This location has created problems in that the responsible department often ignores the economic aspect of the informal economy.
CONCLUSION
Another pertinent argument that dominated the discussion over time was the relationship between the formal and the informal economy. A study of the informal sector in Kenya indicated that with changes in the economic climate, the sector has not perished.
INTRODUCTION
There have been serious political developments regarding the management of informal enterprises. This chapter discusses changes in the approach to managing the informal.
NATURE AND CHARACTERISTICS OF THE INFORMAL ECONOMY IN SOUTH AFRICA ECONOMY IN SOUTH AFRICA
According to the ILO, of the 4 million people employed in the informal economy in South Africa, 2.4 million were women compared to 1.6 million men. In Asian countries, for example, during the financial crisis of the 1990s, the shadow economy grew.
SIZE OF INFORMAL SECTOR IN SOUTH AFRICA AND ITS CONTRIBUTION TO GDP CONTRIBUTION TO GDP
The formal sector has been consistently growing, while employment in the informal sector continues to decline. The higher the industrial contribution of the formal sector, the higher the participants in the informal sector.
LEGISLATIVE AND POLICY ENVIRONMENT
- Pre-democracy legislations and policies
- Post-1994 legislation and policy environment
- Reconstruction and Development Programme: A Policy Framework, 1994
- White Paper on National Strategy for the Development and Promotion of Small Businesses in South Africa, 1995
- Constitution of the Republic of South Africa, 1996
- White Paper on Local Government, 1998
According to Natrass (in Natrass & Adington), changes in South Africa regarding the management of the informal sector began in the 1980s. This recognizes the existence of surviving entrepreneurs, who constitute a significant majority of the informal economy (Valodia , Lebani & Skinner, 2005: 14) and White Paper on National Strategy for the Development and Promotion of Small Business Enterprises in South Africa, 1995).
LOCAL ECONOMIC DEVELOPMENT (LED)
A local development government is expected to manage its affairs in a manner that promotes the growth of the local economy. To be effective, local economic strategies must be supported by an understanding of the local economy.
POLICY IMPLICATIONS
Any policy or strategy aimed at managing the informal sector must take this into account. To be effective, any policy aimed at managing the informal sector must take into account local conditions and be integrative.
CONCLUSION
Another critical challenge affecting the growth and profitability of the informal economy is a restrictive regulatory environment. It is recognized that a high percentage of small and micro enterprises belong to the informal economy.
INTRODUCTION
This chapter examines the characteristics of street vending as well as the challenges street vendors face. The study further analyzes the management of street vendors in several municipalities in South Africa.
DEFINING STREET VENDORS AND THE IMPORTANCE OF STREET VENDING STREET VENDING
This is despite the common belief that when economies and incomes rise, the number of street vendors (and the informal sector in general) will decline. According to ILO (2002a: 16), women traders in sub-Saharan Africa form the majority of street vendors in most countries.
CHALLENGES OF STREET TRADING AND THE DILEMMA OF LOCAL AUTHORITIES LOCAL AUTHORITIES
To date, some of the EU countries still refer to the informal economy as the underground economy (Barta, 2009 and ILO, 2002a: 23). According to WIEGO, most policy makers have a limited understanding of the size and contribution of street vendors to the economy.
ORGANISING IN THE INFORMAL SECTOR
It is not surprising that most of the associations target women, as women make up the largest percentage of street vendors. It is on this basis that various local authorities facilitate the organization of street vendors.
INTERNATIONAL CASE STUDIES
- Street Vendors in Asia
- Street Trading in Africa
- Street Trading in Latin America
Most street vendors sell food and the number is increasing due to demand. This can (to some extent) be related to the fact that most street vendors are not organized.
SOUTH AFRICAN CASE STUDIES
- eThekwini Metropolitan Municipality
- City of Johannesburg Metropolitan Municipality
It is one of the cities in South Africa that has been researched the most about the management of informal traders and the informal economy in general. The adoption of the informal economy policy in 2001 further promoted the progressive approach to the management of the sector.
