Paul Janisch

A little more on the DMR Minerals Council case

It also noted the removal of other provisions which were seen as onerous. 

“The judgment also sets aside the provisions around procurement of goods and services (especially the capital goods target), and supplier and enterprise development which the Minerals Council argued contained unachievable targets for mining companies to meet, making compliance with the 2018 Charter problematic,” it said. 

Big mining companies here often have to buy specialised and very costly equipment from overseas suppliers because the stuff is simply not made here, and all the ANC talk about “re-industrialisation” is not going to change that. Again, it underscores a fundamental detachment from economic reality, or how ANC policies have undermined the manufacturing sector. A 350-tonne truck does not grow on trees. 

via www.dailymaverick.co.za

It's the second paragraph which unfortunately hits the spot. To tell the ruling party that "it underscores a fundamental detachment from economic reality, or how ANC policies have undermined the manufacturing sector."

They've run out of road. It's all collapsing. I think Cyril stayed the collapse for longer than Nkosazana would have.

The government has lost two significant empowerment related cases

This first one is the once-empowered, always empower issue.  To quote the Daily Maverick.

“The minister uses the Mining Charter to guide his decision-making and applicants use it to guide their application. But once the application is granted and the transformation objectives are contained in the mining right itself and provided the mining company acts under those terms, then subsequent mining charters cannot change those retrospectively,

In other words.  The right is linked to the charter that was gazetted at the time the right was granted, you can't change the scope of that right by gazetting a new code.  Gwede gets one on the nose.  He's also useless and beyond his productive age

The next one is the Solidarity/Afriforum case that we argued about the Tourism relief fund. The fund was established to assist tourism companies that were left flat during the various lockdowns. 

The minister had argued that government was obliged by statute to include B-BBEE criteria in the directions for eligibility to financial assistance.

"It is apparent that the purposes of the DMA [Disaster Management Act], on the one hand, and the B-BBEE Act, on the other, are very different and that each statute is directed at achieving different goals: the DMA is aimed at preventing or limiting disasters, mitigating their impact and enabling post-disast mitigating their impact and enabling post-disaster recovery, while the B-BBEE Act is aimed at promoting black economic empowerment in order to enable black people to participate meaningfully in the economy," the SCA ruling stated.

This case should never have gone to court.  If you are white (or not-black like a Nigerian) and you pay your UIF, then you are entitled to claim the benefit when you lose your job.  There is no requirement to prove your BEE credentials when you claim your benefit.  The Tourism Relief Fund was the same.  However it was not plain sailing for Solidarity and Afriforum.

The Solidarity Trade Union and lobby group AfriForum applied urgently, in separate cases, in the North Gauteng Division of the High Court in Pretoria, to review and set aside what they described as "race-based criteria" for eligibility for financial assistance from the fund. Their applications were dismissed with costs and they were refused leave to appeal.

Being the arrogant and incompetent legislators that both of these departments will no doubt appeal.  They can't move on.  They must take the one foot out  of their mouths to put the other one in.  And this, fellow voters, is the best the anc has to offer.  I must re-iterate, I like Cyril.  He is the only politician that can actually pull us out of this anc-created fuck-up.  I have this feeling that he may be talking to a few opposition parties, unlikely to be the EFF, to do something with them.  The anc is now so incompetent and broke that it's had it. 

Famous last wors (sic) probably.  Happy heritage day

 

 

 

The might of the awdoz is felt as far as Nigeria

There's a story I like to tell, unlike some of my stories this one is true. Many years ago before I was as jaded as I am now I went to meet a potential client about something (more on that potential later). The gentleman I met there was telling me that his company was 60% black owned. I don't know why I figured out that he was Zimbabwean but I asked if that was true. "Yes," said the Zimman, "but I have an ID book and I'm naturalised." And when did you arrive here I asked. "In 2000." Was his response.

"Oh!", I exclaimed. "But you are white."

Whatever potential there existed for work after that somewhat inappropriate insult disappeared immediately. But it's true, he's not black in terms of the BEE Act, nor the EE Act and a myriad other pieces of legislation.

I suppose those of us who have been in this business for as long as we have know that proving birth by naturalisation is ridiculously difficult. I don't bother any more – I just call them all white. It's sometimes quite easy to notice a black foreigner by their English accent – Zimbabweans and Malawians have a certain accent that you can pick up. Nigerians have two telling things that point out their country of origin, their names and their accents. Their accents are  often mistaken by Hollywood as South African accents (mixed with a little  Caribbean). The Nigerian English language is so distinct that the BBC has a special Pidgin service for Nigerians. If you doubt me then read this

One of di reasons why dem also introduce di toll-free number na to implement a nationwide system for di reporting of emergencies to emergency service for Nigeria.

And for Nigerians to get access to emergency service agencies for quick and timely response.

Wetin be dis emergency pesin go fit call di number for?

Vicky Adey Consulting CC made a similar mistake as my Zimman of so long ago. They were portraying themselves as 100% black owned and 60% black women owned. It's a CC and if you want to know who the members are I'm sure that CIPRO could tell you. The two members are Olufunsho Adebayo Ademoye and Phumudzo Nancy Muthelo. These two were doing some good government business as a level 1 until some concerned system ratted on them to the BEE Commission. You can read the whole story here, it doesn't serve me to quote it verbatim. Vicky Adey claimed that they didn't know that the definition of black was so South African orientated. I tend to believe them - Olufunsho Adebayo Ademoye is so not a typical South African name. If I saw the CK documents and saw that name I would look very closely at the ID number to confirm that it was a South African.

Ignorance is no excuse and the awesome awdoz rained vitriol and meted out a very harsh punishment for breaking the law. This ranged from a public apology on Facebook and Twitter, they had to remove themselves from vendor data bases and then they were fined R50k that needed to be paid to NSFAS.

This then begs a question – where the hell does the awesome get the power to hand out sanctions like that? Her power, if it exists at all, must come from the BEE Act. The problem is I can't find it. If you look at section 130 of the Amended BEE Act speaks about fines and penalties but it's very clear that a court needs to impose the fine or penalty. But the awesome and her crew of race-obsessed apparatchiks seem to be able to do this.

I don't think they can, what they are doing is suggesting to the guilty party that if they cooperate with the commission then it won't go to the courts. But you can't do that because 130(2) says

(2) A B-BBEE verification professional or any procurement officer or other official of an organ of state or public entity who becomes aware of the commission of, or any attempt to commit, any offence referred to in subsection (1) and fails to report it to an appropriate law enforcement agency, is guilty of an offence.

The commission is complicit in this offence and they themselves need to be reported in terms of the Act.

There are a lot of punishments that were dished out. Most of them are designed to humiliate the offender. That cannot be constitutional. If you pay an admission of guilt fine for a traffic transgression you aren't required to go onto Facebook and Twitter to proclaim your guilt. Then there is the fine. Not only did they issue a fine they directed the payment to a cause that they nominated viz NSFAS. Why because the useless anc government cannot provide for its citizens.

This whole thing is wrong. But then I might be wrong. If I am I would like to know where this power comes from.

Cyril – just remove her and Slappie. What value does the commission add?

Skills development hacks for BEE scorecards

It's probably about time for me to start offering one on ones discussing the various BEE hacks that I have mastered over the last 18 years. If there is an interest please email me and we can look at a presentation.

It's no secret that I think the skills development code is the most ridiculous code of the lot, and that's saying a fair amount. I have mentioned before that the bursary requirement has been largely rejected by corporate South Africa. If it was we wouldn't be having the student process that appear at the beginning of each year.

However compliance with skills development is still a requirement. The trick is to go for the easiest and cheapest points to get to the subminimum. I'll start with the DTIC's generic scorecard

Large Enterprises - Skills Development. Total points - 25 (including 5 bonus points) - (PRIORITY)
Description		Weighting points	Compliance Target
	Skills development expenditure on any programme specified in the Learning Programme Matrix for black people as a percentage of the leviable amount
Skills development expenditure on learning programmes specified in the Learning Programmes Matrix for black people as a percentage of leviable amount		6	3.5%
Skills development expenditure on bursaries for black people as a percentage of leviable amount		4	2.5%
Skills development expenditure on learning programmes specified in the Learning Programmes Matrix for black employees with disabilities as a percentage of leviable amount		4	0.3%
	Learnerships, Apprenticeships and Internships
Number of black people participating in Learnerships, Apprenticeships and Internships as a percentage of number of employees		6	5%
	Bonus points
Number of black people absorbed by the Measured and Industry Entity at the end of the learnership programme		5	100%

The most expensive points are the bursaries and skills development points. Old Slaptjips appears to be acutely aware of the bursary bollocks because he hasn't extended it to the other codes. This is the recommended approach I would take to get to the subminimum.

The trick lies in learnerships. There are many learning programmes out there but none as good as ours. What you want is to put 5% of your staff, subject to the EAP on a learnership. Our SMME Accelerator is an entrepreneurial requirement that will put the necessary numbers onto the learnership and learn how to become self-sufficient as small businesses. We aren't talking large amounts of learners here. There are your first six points. Now if you make sure that all of these people are disabled, which is absolutely possible for people on an entrepreneurship programme, then the spend on the learners talks to the disabled skills target, which is 0.3% of payroll. Then you take that spend and it may just give you a few points.

Let's take a fictitious example.

This is what Jones and Vusi's targets look like

Leviable amount	16 000 000
Skills Spend	560 000
Bursary Spend	400 000
Disabled skills target	48 000
Total Staff	240
Learners	12

You can't take 12 learners because of the national EAP (which we will use for this exercise). They'll have to take 15

EAP Representation		Target number	Actual Number
AM	45.89%	5.51	6.00	2.75
CM	6.54%	0.78	1.00	0.39
IM	2.14%	0.26	1.00	0.13
AF	38.56%	4.63	5.00	2.31
CF	5.64%	0.68	1.00	0.34
IF	1.24%	0.15	1.00	0.07
TOTAL		12.00	15.00	6.00

At an average cost per learner of R2600, which includes the stipend for a NQF2 learnership, you'll get the following over a 12 month period.

EAP Representation	Value over 12 months
AM	187 200
CM	31 200
IM	31 200
AF	156 000
CF	31 200
IF	31 200
TOTAL	468 000

If two of these people were disabled then you would get R62,300 towards your disability target of R48,000, which is not subject to the EAP you'll get the full four points for disability.

The balance of the spend will then go up to the skills target.

	Modified EAP for points	Target spend per race group	Actual spend per race group	Score
AM	45.89%	256 956.03	187 200.00	2.0057
CM	6.54%	36 617.81	31 200.00	0.3343
IM	2.14%	11 995.49	31 200.00	0.1285
AF	38.56%	215 918.83	156 000.00	1.6714
CF	5.64%	31 567.08	31 200.00	0.3343
IF	1.24%	6 944.76	31 200.00	0.0744
	100.00%	560 000.00	468 000.00	4.55

For 15 learners over 12 months that will effectively cost you nothing due to the tax deductions, this is what you are looking at for points.

Description		Weighting points	Points
	Skills development expenditure on any programme specified in the Learning Programme Matrix for black people as a percentage of the leviable amount
Skills development expenditure		6	4.55
Bursaries		4
Disabled		4	4
	Learnerships, Apprenticeships and Internships
Learnerships		6	5.59
TOTAL			14.55

That's the DTI's hack. Should cost you close to nothing if you are in a tax paying position. This is for most other codes (other than Construction, Transport and FSC).

I'll go with the ICT code because that's more refined than others (I shouldn't give it that much credit)

Description		Weighting points	Compliance Target
	Skills development expenditure on any programme specified in the Learning Programme Matrix for black people as a percentage of the leviable amount
Skills development expenditure on learning programmes specified in the Learning Programmes Matrix for black people as a percentage of leviable amount (EAP)		8	6%
Skills development expenditure on learning programmes specified in the Learning Programmes Matrix for black people with disabilities as a percentage of leviable amount (EAP)		4	0.3%
	Learnerships, Apprenticeships and Internships
Number of black people participating in Learnerships, Apprenticeships and Internships as a percentage of number of employees (EAP)		4	2.5%
Number of black unemployed people participating in training specified in the learning programme matrix as a percentage of number of employees (EAP)		4	2.5%
	Bonus points
Number of black people absorbed by the Measured and Industry Entity at the end of the learnership programme (EAP)		5	100%

The ICT code is a bugger because of this clause

A Measured Entity must achieve a minimum of 40% of the total targets set out in each of paragraphs 2.1.1 and 2.1.2 of the Skills Development Element. This is the skills expenditure AND the spend. Therefore at a minimum you'll need 6 for skills spend and 4 for learnerships etc.

I want to start with the learnerships etc. The unemployed people requirement is something that's been missed out across the board. They talk about the ENTIRE training matrix. This means that it could go from Category A to G – we know that F and G are informal training.

Let's go back to Jones and Vusi Software (must be an ICT company)

Leviable amount	16 000 000
Skills Spend	960 000
Disabled skills target	48 000
Total Staff	240
Learners	6
Unemployed	6

We'll reduce the number of learners to 10 – because it'll give you full points for learnerships.

This is what your points will look like for the learnerships

EAP Representation	Target number	Actual Number	Score
AM	2.75	3.00	1.84
CM	0.39	1.00	0.26
IM	0.13	1.00	0.09
AF	2.31	3.00	1.54
CF	0.34	1.00	0.23
IF	0.07	1.00	0.05
TOTAL	6.00	10.00	4.00

You've already got half the points for this sub-portion. But why stop there. What you do is take the same number of people and put them on a category G programme for a day in your offices, or somewhere else. You teach something interesting about operating your business. You'll need to get registers, unemployment letters, ID copies and other POPI unfriendly documents. And bang you've got your next four points.

YOU CAN'T DO THAT – I hear you say.

Oh but you can. Paragraph 5.6 of STATEMENT AICT 300 says

"Skills Development Expenditure arising from Informal and workplace Learning Programmes or from Category F and G Learning Programmes under the Learning Programmes Matrix cannot represent more than 15% of the total value of SKILLS DEVELOPMENT EXPENDITURE.."

This has got nothing to do with expenditure, sure you can add the costs of that session to your expenditure at the top of the code, but I wouldn't bother it's too much of a schlepp. Also – there no requirement for the duration of the training. You could do an hour with 10 people as per the numbers below. Go on take four points.

EAP Representation	Target number	Actual Number	Score
AM	2.75	3.00	1.84
CM	0.39	1.00	0.26
IM	0.13	1.00	0.09
AF	2.31	3.00	1.54
CF	0.34	1.00	0.23
IF	0.07	1.00	0.05
TOTAL	6.00	10.00	4.00

Let's get on with the actual expenditure of the learnerships. The learnerships will all need to be disabled people, the ICT code is not as friendly as the DTIC's code when it comes to disabled people. Still you'll shoot the disabled target by a long shot.

Disabled
	Modified EAP for points	Target spend per race group	Actual spend per race group	Score
AM	45.89%	22 024.80	93 600.00	1.8354
CM	6.54%	3 138.67	31 200.00	0.2616
IM	2.14%	1 028.18	31 200.00	0.0857
AF	38.56%	18 507.33	93 600.00	1.5423
CF	5.64%	2 705.75	31 200.00	0.2255
IF	1.24%	595.26	31 200.00	0.0496
	100.00%	48 000.00	312 000.00	4.00

You're still two points away from the subminimum.

	Modified EAP for points	Target spend per race group	Actual spend per race group	Score
AM	45.89%	440 496.05	93 600.00	0.7800
CM	6.54%	62 773.39	31 200.00	0.2600
IM	2.14%	20 563.70	31 200.00	0.1714
AF	38.56%	370 146.56	93 600.00	0.7800
CF	5.64%	54 114.99	31 200.00	0.2600
IF	1.24%	11 905.30	31 200.00	0.0992
	100.00%	960 000.00	312 000.00	2.35

And here's your score

Large Enterprises - Skills Development. Total points - 20 (plus 5 bonus points) - (PRIORITY)
Description		Weighting points	Score
	Skills development expenditure on any programme specified in the Learning Programme Matrix for black people as a percentage of the leviable amount
Skills development expenditure		8	2.35
Disabled skills development expenditure		4	4
	Learnerships, Apprenticeships and Internships
Learnerships, Apprenticeships and Internships		4	4
Black unemployed people participating in training specified in the learning programme matrix		4	4
TOTAL			14.35

The two subminima have been met and once again this is all tax deductible. In fact because you have put disabled people on the learnership you get more money back.

As to whether Slappie gets to change the codes that remains to be seen. He's actually useless. Not up there with bolshie bob, bolshie was a different waste of privileged private school space. Bolshie did stuff. Slaptjips doesn't do much except ban hot food.

Oh Cyril, what the hell have you given us, we've fucking had enough now.

A BEE scorecard does not equal transformation

Does anybody remember this quote

With Dr Khoza in the chair, Nedbank is the only bank among the Big 4 that has yet to find a black person or a woman for the role of Chief Executive. It is also under Dr Khoza's leadership that the Chief Financial Officer - a black woman - does not have a critical area like balance sheet management in her responsibility portfolio.

This brings into question the substance of the extraordinarily high BBBEE score on which Nedbank prides itself.

These extraordinary words come from the typewriter of not jimmy manyi. A man who is devoid of credibility, always has been devoid of credibility. Washouts like that end up defending the indefensible – moron zuma.

The point here is that manyi made is absolutely clear that Nedbank's BEE scorecard in 2012, which was a level 2, was no indication of its transformation process. Alas our poor hazbeen (ain't never been) is correct. He's correct on two fronts

1. A high BEE level doesn't mean that you won't be accused of a lack of transformation
2. BEE levels are a moving target. You can be 100% black owned and level minus two million and someone will still question it

I was asked to do a presentation last week about BEE and transformation. The board of this company was of the view that they needed to get them a scorecard going so that they can measure their transformation. I dispelled that myth very quickly. All a scorecard does is show that you have done some ownership, you may employ some black people, you've thrown a massive fortune at skills development, ED, SD and SED and that your suppliers have done the same.

A scorecard is a crass attempt at measuring social cohesion. It then goes through a verification process that focuses on documentation. That's not transformation. Hell even the most inept government on the planet doesn't even know what this means, if they don't then how on earth are we supposed to know. The only thing this government and its allies know is that you MUST throw in mountains of regulation to force this so-called social cohesion. To drive the point home they appoint a mkhwebane clone as a BEE Commissioner to pronounce on stuff that she neither understands nor cares to understand. She has allies in the form of the once bankrupt black business council – ag sjym.

I've never been a transformation person, I struggle to lose weight because I can't commit to any programme. Transformation is the same, it's a programme that is consistent. It's a change of behaviour. This change in behaviour does not suit the fat cats that have no idea what work is – let alone hard work. They want everything for free, they don't want to work, they want cars and girls and Italian designer clothes. To get this for free that must show that their legitimate competitors are racist. It doesn't take much to read between the lines here

(T)he new BBC leadership is bullish about asserting its influence on the Broad-Based Black Economic Empowerment Advisory Council and reviewing the black industrialists' programme. (T)he BBC has raised its hand in a bid to obtain seats on the council.

"We are seeking representation so that the aspirations and the mandate of black business organisations are considered in all respects when you deal with the question of broad-based black economic empowerment," says new BBC president Monage.

There's also another practical reason the BBC is eager to have representation on that council. For starters, the council works closely with the BEE Commission. In particular, the council and the commission collaborate on fronting and other empowerment-related issues.

"We need that commission to have teeth to bite where there are fraudulent BEE transactions," charges Monage. "We cannot sit and complain year-in, year-out about transformation."

Why would the BBC want to push this agenda? To me it's simple – the more they push the fronting agenda the more they are able to create a smokescreen for their more powerful (and very entitled) members to lobby behind our backs for deals that we don't know about and are not entitled to bid for.

We'll carry on with our BEE scorecards and out BEE compliance, and the fat cats will carry on stealing. At some stage both of those will have to give.