The MEC of the Department of Economic, Small Business Developmet. Tourism and Environmental Affairs (Destea), Makalo Mohale, says the programme was suspended or “placed in abeyance” temporarily, but the future thereof will be communicated with the public “shortly”.

In March 2019, the OFM News team revealed the FDC had shut its doors on two dozen local businesses, terminating their contracts and ordering them to vacate the entity’s building by April 2019. The programme started in 2016 and offers full office services to upcoming businesses in the area at a fixed monthly rate. According to a representative of the disgruntled group, who asked to remain anonymous, the FDC renewed all the parties’ contracts in October 2018 as was expected. The public entities’ officials then backdated those contracts to May 2018 in a twist of events. The conditions of the latest contracts became the heart of the contentious relationship between the respective parties.

The small business owners alleged the contracts were backdated, to give the entity space to forcibly remove them from the building with very little notice. In February, 23 of the 24 tenants were allegedly given 28 working days to vacate the building, contrary to the terms in the contract. The contract stipulates that tenants should be given between 40 and 80 working days’ notice.

FDC CEO, Ikhraam Osman, disputed the allegations made by the tenants, telling the Portfolio Committee on Public Accounts (Propac) later in the year, that the programme was no longer financially feasible, due to some businesses’ failure to pay rent. When probed, it was revealed that less than half of the small businesses failed to meet their obligations and pay rent, as opposed to all 23 companies.

The Free State Development Corporation has come under the spotlight in recent months, first over its dealings with former Free State Premier, Ace Magashule’s daughter Thoko Malembe and later regarding its controversial loan to the now-defunct VBS Mutual Bank.

OFM News