One of Barbados best-known small businessmen has major reservations about Government’s decision to close the Social Investment Fund.
Delivering his maiden speech in the Upper House today, new Independent Senator John Watson said the facility on which he previously served as a committee member was conceptualised for a good purpose in 1998.
He feared micro and small businesses, which needed special funding they could not otherwise get from commercial banks and other financiers, would now be disadvantaged.
“I fear now without the Social Investment Fund and without an organisation that really looks after micro business … that real micro businesses will find it difficult,” he said.
“When I look at the reason for this fund way back then I could find no fault there … because small businesses need different types of financing. Some of them are able to go to commercial banks and get financing, some are not able to go to commercial banks but need financing. Some of them are able to go to development institutions like what the Barbados Development Bank was and now the Enterprise Growth Fund to get financing but some of them can’t.
“I saw this fund at that time as one of the types of financing that was required for small businesses … and as I understood it, it was more of encouraging people who have seen an opportunity in their district or their surrounding community.”
Watson said as far as he was concerned the Social Investment Fund he served on “did serve its purpose from that point of view”.
“I was told many years ago that if you have a Rolls Royce and you are driving it badly it doesn’t make the Rolls Royce a bad car it just makes the driver a bad driver,” he stated.
“So I believe that the purposes of the Social Investment Fund were noble and were necessary. There would be no reason to close it but rather a reason to revamp it. There was really no reason to close the fund but to deal with the issues that affected the fund so that it could be more efficient.”
Acknowledging that the end of the fund was now a done deal, the senator said he hoped now that another agency, Fund Access, had received the majority of the funds transferred that its officers would be more accommodating to micro businesses.
“Business development officers at Fund Access would have a mind set that is slightly different to an officer who is just above welfare thinking because that is what that kind of micro business is, just a step above welfare,” he said.
“A person who is going to access a loan based on a marketing strategies and financial background … is not the same kind of person who can access a loan for a person who just saw the idea of opening a window in their house and just selling sweet drinks.
“I think that the officers within those institutions would now have to understand what is necessary to have those funds for that kind of person. I do not accept that transferring funds to the Welfare Department is an alternative to the closing of this Social Investment Fund … because we are not trying to encourage welfare we are trying to encourage work.
“I thought it was necessary to say those few words and to just implore the Government that in looking at the financing of small businesses that they must take that type of small business into account where the $2,000 means a lot…, and if there is no institution that can provide that kind of funding I think our talk about the development of an entrepreneurial class in Barbados will suffer substantially,” he warned. (SC)
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