This analysis is not spot on but it’s not far off. The score comes out at 24 points – but it’s assumed that the enterprise/supplier development/socio-economic development points have been bought to get to this score. This is non-compliant. You need 40 points to get onto the scorecard and if you meet the subminima of the three priority elements you drop a maximum of one level. Without ownership you will always drop a level. This means that we need to get 55 points to get you up to a level 8.
A few things.
- I used the procurement info we used last year. It's obvious that your client is happy with the imported goods that you supply. However because you use an importing agent and this makes up 80% of your total expenditure your procurement score is going to suffer.
- The skills development calculations are there to show you how ridiculous the targets are. Your target (based on Nov to Oct 2017’s figures) for skills development spend is over R500k. This doesn’t need to be spent on your staff – you can spend the money to train other black people but it must be based on the economically active population (EAP) targets. There is a way to get around this using the employee tax incentive (ETI). In fact if you make use of the ETI and donate a smallish amount (way less than R500k) to a disabled school – then you’ll get the full number of points
- A similar plan can be made for enterprise and supplier development.
However – having noted all that. I’m not sure that you will get to 55 points if your procurement isn’t in order so you’ll probably end up being non-compliant anyway. The question is “Is it worth it to go through this exercise and the expense when the result is negative anyway?”
I’ve added a letter that should buy you some time. I’ll write a new one every four months.
I’m sorry that this system is not designed to help you at all. I am hoping that should Cyril come in he will start relaxing rules to make compliance a little more achievable. He’d go a long way in removing the priority elements.
Paul
Comments