There was a conversation between me and a person who I had met yet about their BEE scorecard. They were told by their completely unreasonable clients that they have to be a level 1 or 2. We're talking about a QSE - the company actually wanted to implement the BEE scorecard to get their. After describing bolshie bob (Rob Davies) as a useless minister, an inept communist and a total economy wrecker (amidst a mountain of apt expletives), I persuaded her to restructure her company to get 51% black owned. There are new schemes out there that I'm in favour of and she's going that route.
Here is another example of a document that carries the minister's signature and like its generic predecessor it defies basic mathematical logic. You would think that if this useless economy wrecker signed something he would actually have read it. But he hasn't and he doesn't - he wants to make us strong like mother Russia, basic literacy is not his thing. He needs to be fired for sheer ineptitude. Cyril - just get rid of him, he's killing the country.
There is a solution at the bottom of this diatribe - please read on.
However there is a flaw in the amended ICT Code when it comes to specialised entities and qualifying small enterprises.
The ICT Code sets the following levels
Contribution Level
|
Generic Code
|
ICT Code
|
Recognition level
|
Level One
|
≥ 100 points
|
≥ 120 points
|
135%
|
Level Two
|
≥ 95 points but < 100 points
|
≥ 115 points but < 120 points
|
125%
|
Level Three
|
≥ 90 points but < 95 points
|
≥ 110 points but < 115 points
|
110%
|
Level Four
|
≥ 80 points but < 90 points
|
≥ 100 points but < 110 points
|
100%
|
Level Five
|
≥ 75 points but < 80 points
|
≥ 95 points but < 100 points
|
80%
|
Level Six
|
≥ 70 points but < 75 points
|
≥ 90 points but < 95 points
|
60%
|
Level Seven
|
≥ 55 points but < 70 points
|
≥ 75 points but < 90 points
|
50%
|
Level Eight
|
≥ 40 points but < 55 points
|
≥ 55 points but < 75 points
|
10%
|
Non-Compliant Contributor
|
< 40 points
|
< 55 points
|
0%
|
It follows that if the points to level ratio is increased because the scorecard comes out at a higher total. This is true for the large enterprises BEE scorecard which is summarised below.
Element
|
Sub-element
|
Total
|
Ownership (priority)
|
|
25
|
Management Control
|
|
23
|
Skills Development (priority)
|
|
20
|
Bonus points
|
|
5
|
Enterprise and supplier development (priority)
|
|
|
|
Procurement
|
25
|
|
Bonus points
|
2
|
|
Supplier Development (2%)
|
10
|
|
Enterprise Development (3%)
|
15
|
|
Bonus points
|
4
|
Socio-economic development (1.5%)
|
|
12
|
TOTAL
|
|
141
|
The total of 141 points is a full 21 points over the level one target of 120 points – amounting to a 15% margin of points. The total number of points excluding bonus points is 130 – 10 points in excess of the level one target.
By way of illustration, the dti’s generic revised BEE codes of good practice are measure out of a total of 118 points. This is 109 points excluding the bonus points - 9 points in excess of the level one target.
Element
|
Actual points as per each code
|
Ownership (priority element)
|
25
|
Management control
|
19
|
Skills development (priority element)
|
25
|
Enterprise and Supplier Development (priority element)
|
44
|
Socio-economic development
|
5
|
|
118
|
In this case we have a similar margin of 18%.
The ICT specialised entities scorecard comes out at a total of 123 points if one reads the code.
Element
|
Sub-element
|
Total
|
Management Control
|
|
20
|
Bonus points
|
|
2
|
Skills Development
|
|
25
|
Bonus points
|
|
5
|
Enterprise and supplier development
|
|
|
|
Procurement
|
30
|
|
Bonus points
|
2
|
|
Supplier Development (2%)
|
10
|
|
Enterprise Development (3%)
|
15
|
|
Bonus points
|
2
|
Socio-economic development (1.5%)
|
|
12
|
TOTAL
|
|
123
|
This is in contradiction of paragraph 3.5 of STATEMENT AICT004: SCORECARDS FOR SPECIALISED ENTERPRISES, which provides the following table. It’s important to note that even with the bonus 11 points it is impossible to get to a level 1.
Element
|
Total
|
Management Control
|
20
|
Skills Development
|
25
|
Enterprise and supplier development
|
50
|
Socio-economic development (1.5%)
|
12
|
TOTAL
|
107 (excluding bonus points)
|
A similar issue has happened with the QSE ICT Codes. In this case the code comes to a total of 117 points before bonus points
Element
|
Sub-element
|
Total
|
Ownership (priority)
|
|
25
|
Management Control
|
|
15
|
Skills Development (alternative priority)
|
|
25
|
Bonus points
|
|
5
|
Enterprise and supplier development (alternative priority)
|
|
|
|
Procurement
|
15
|
|
Bonus point
|
1
|
|
Supplier Development (2%)
|
10
|
|
Enterprise Development (2%)
|
15
|
|
Bonus points
|
4
|
Socio-economic development (1%)
|
|
12
|
TOTAL
|
|
127
|
It's patently obvious that this is an error and that QSE's and specilialised entities CANNOT get to a level one because the code doesn't permit it. Other codes allow those types of entities to get to a level one without bonus points. What I say to you is that you measure these two using the generic levels. Please don't ask the B-BBEE ICT Sector Council - they haven't said a word about this glaring error since bobbie put his inconsequential signature on the code in November 2016 .