There is something deeply uncomfortable about a policy that can look at a household struggling to make ends meet, discover that the property owner is a director or owner of a business, and potentially conclude that the household should not qualify for indigent support.
This is a question Buffalo City Metropolitan Municipality needs to answer.
The municipality’s 2026/27 Indigent Support Policy Review states that the owner of the property applying for indigent support may not be “an owner, director or derive income from a business”.
The same condition appears in the municipality’s qualification criteria. The policy forms part of the municipality’s 2026/27 budget-related policies.
At face value, one can understand the intention. Indigent support is meant for households that genuinely cannot afford basic municipal services.
Public money and municipal subsidies cannot simply be handed out without proper criteria. But here is where the policy deserves closer scrutiny. Being a director of a company does not necessarily mean you have an income.
A person can register a company with the Companies and Intellectual Property Commission and never trade. They can be a director of a dormant company. They can own a business that has made no money. They can be unemployed while trying to build a business.
They can register a company because they want to apply for funding, take part in government programmes or pursue opportunities in the private sector.
They can have a CIPC registration certificate in their hand and still have little money in their bank account. That distinction matters. Buffalo City’s indigent policy is supposed to find households that are genuinely unable to meet their municipal obligations.
The municipality has criteria relating to household income and property value, and applicants are subject to verification.
The policy also recognises that poverty is more complex than simply the collection and disbursement of municipal revenue.
Yet the exclusion relating to business ownership or directorship creates a different test: not simply “Can this household afford its municipal services,” but potentially “Does the property owner have a business?” Those are not necessarily the same question.
Consider a young person in Mdantsane who is unemployed and living in a household that is struggling financially.
They register a small company because they are trying to change their circumstances. The company has never generated an income. There is no salary, no dividend, and no meaningful business turnover.
Has that person suddenly become financially secure because their name appears on a CIPC registration? Of course not.
But the wording of the policy raises the possibility that their attempt to take part in the economy can become a barrier to receiving help intended for households experiencing poverty.
This is where Buffalo City needs to have an honest conversation about the difference between business registration, business ownership, and economic means.
I am not suggesting that every company director should qualify for indigent support.
That would be unreasonable.
If someone owns a profitable business and earns an income above the applicable threshold, they should not receive a subsidy intended for genuinely indigent households.
The question is whether the municipality should distinguish between someone who owns a functioning, income-generating business, and someone whose company exists on the CIPC register.
That distinction becomes even more important in a country where government repeatedly encourages unemployed people, particularly young people, to become entrepreneurs.
We tell young South Africans to register companies. We tell them to formalise their businesses. We tell them to apply for funding. We tell them to create jobs instead of waiting for government to employ them.
But what message do we send when a low-income person who follows that advice can potentially find themselves excluded from municipal indigent support simply because they became a company director?
We cannot tell people to climb the ladder while simultaneously removing the step beneath them. This is not just about a company registration.
It is about how we think about poverty and economic participation. A person can be poor and entrepreneurial at the same time. A person can be unemployed and a business owner.
A person can be a director of a company that has never made a cent.
And a household can remain financially vulnerable even when one of its members has taken the major step of trying to set up a business.
The municipality’s own policy framework acknowledges the need to consider socioeconomic circumstances and promotes local economic development as one of its guiding principles.
That principle deserves to be tested against the practical consequences of the policy.
If the aim is to prevent people with genuine financial means from accessing indigent subsidies, then the municipality should focus on actual means, not merely legal status.
There is a perfectly reasonable verification question: What income does the business generate? Does the individual receive payment from it? Is the company trading? What does the household’s financial position actually look like?
Those questions tell us much more about whether someone can afford municipal services than the mere existence of a company registration.
Buffalo City should therefore review this provision and consider whether it is unintentionally discouraging entrepreneurship among precisely the people who most need a pathway out of poverty. We should not create a choice between receiving basic municipal aid and trying to build a business.
The two should not be mutually exclusive. A low-income person should be allowed to try to change their circumstances without being treated as though they have already succeeded.
Because registering a company is not the same thing as creating wealth.
And in a city that desperately needs both economic growth and relief for households struggling with poverty, we should be incredibly careful about creating policies that confuse the two.
>creditparsans<Buzani is a business consultant and youth empowerment advocate, as well as a founding member of an award-winning SME and of the vibrant Mdantsane entrepreneur network Kasi Konversations