Paul Janisch

A skilled approach to skills development

Some of my good readers (hopefully very few) know Chavvy Moray Eel and his insignificant skills development company. Chavvy is like many of the other charlatan service providers in this country. They'll charge you a fortune for BEE compliance because they put the fear of god into them and they know their clients know a hell of a lot less than they do. They, like all of us, have a relationship with a verification agency where Larney will ensure that you get all the points that you paid more than you should have for. So good is Larney that she will threaten her clients with fronting the awful awdoz if they dare venture away from Chavvy's business.

Not all are Chavs like Chavvy, but many are. I've seen them all. One company ripped off one of my clients and then couldn't even get him onto the scorecard.

Let's stick to the rules here. Don't spend money if it's not going to get you onto the scorecard. This is the first thing I do. I look at the feasibility of the client getting onto the BEE scorecard and then I modify the programmes to achieve those points. If it's not going to work out then I'll suggest the client gets a non-compliant BEE scorecard for R5500 (which in itself is expensive) but remember that for a company that has no ownership 54.9 points and 9 points produce the same result – non compliant. Don't' spend a fortune to get onto the scorecard. Don't bother if you can't. Of course the ownership element can easily be sorted out with Ownershield, so that problem can now go away.

The next stop is skills development. It is chronically expensive, ludicrously so. I still struggle to think how that business sector in this country could have agreed to that. When you start looking at a skills development programme look at the cheapest points. I'm now talking about the generic scorecard. I start off at the learnership programme, more often than not you don't need that many learnerships/internships in place to get those points. I would aim for about 5.5 out of the six. Unfortunately Indian skills development doesn't do much for points so I tend to leave them out. Then look at disabled skills. It's a lot cheaper than any other programme and is not subject to the EAP. At this point you should be looking at something close to 9 points. If you have done the learnership programme properly then you will have put your highest paid black people on a learnership programme because you can count their salaries as skills spend. By the way, herein lies the dichotomy of the skills development element. If you are going to get more points for the higher paid people, then why would you bother with the lower paid people who need it the most.

Forget about bursaries. They were bolshie bob's final confirmation that he was a useless commie who was blinded by ideology and was completely unsuited to anything other than an academic post in a small eastern European country.

Then we need to see if you can get most of the available grant money to cover the expense of the skills programme. I didn't know that you could do this until I asked Amanda Earle of HR Ignite to meet with some of my clients. This is Amanda's forte and she's really good at it. She has set herself the task of getting the grants to pay for the training of all the staff, in other words the 1% SDL covers the 6% BEE spend AND white and foreign skills development.

It was Amanda who stressed that you need to have a sussed skills development partner. A company that is not going to rip you off and will push for the results that you want at the least cost. And this is how I happened upon Johan Barkhuizen (who insists on being called Barkies) and Corne Basson of Ultivate. I had the pleasure of joining Barkies in a meeting in Bloemfontein. We left at six in the morning and had an hour meeting at 11:30 and went back. But it was a very significant meeting because Barkies told the client that he didn't need 1000 outsourced learners to achieve their BEE targets. 180 learners would do, 120 of which were internal people who earned about 200k a year. This would translate into about R24million skills spend. And the 12H deduction is still applicable.

This appears to be Ultivate's mission. Get your internal people trained and then look at external learnerships to cover the disabled spend. Ultivate is not so much a skills development provider. They are more of a broker, they will go and find the best service providers to deliver the courses. On top of this they will negotiate the best prices for their clients. They understand that there are a large number of service providers in the market place. It's a competitive business, why should the client pay more. We could call it discount skills I suppose.

One of the things that really excites me about Ultivate's position on skills is the emphasis on internships. When I say internships I refer to those internships that the codes talk about. If you read the definition in that god awful matrix you'll notice the ABET students can be regarded as interns. Barkies and Corne ask the simple question as to why this concept cannot be extended to other types of skills. Sure you won't get the tax breaks, but you will get the salary spend. Also why should an internship be a 12 month programme. Why not make it 6 months with an assessment at the end.

Why not?

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.

Employee Tax Incentive set to be extended. Call me about this, I can sort out almost all of your skills issues

For those of you who aren't aware of the Employee Tax Incentive (ETI) then read on.  Before we go into the nitty gritty of the ETI, I have read that it will be extended beyond February 2019.  It is critical to the success of the YES, which in itself is somewhat dependent on our communist leader, bolshie bob, publishing an amendment that actually encourages companies to make use of it (we sit in hope - history doesn't favour this though).

The ETI is also a very positive incentive for skills development.  We have figured out a way to get almost all the points for skills development using the ETI and for far less financial consideration than bolshie bob's ludicrous 6% of payroll.  Call me and I'll tell you more - remember, all the points for a fraction of the money.

Back to the ETI - courtesy of SARS (the link is above).

Why is there an ETI?

Millions of young South Africans are excluded from participating in economic activity, and as a result suffer disproportionately from unemployment, discouragement and economic marginalisation. High youth unemployment means young people are not gaining the skills or experience needed to drive the economy forward. This lack of skills can have long-term adverse effects on the economy.

In South Africa the current lack of skills and experience as well as perceptions regarding the restrictiveness of labour regulations make some prospective employers reluctant to hire the youth.

As a South African employer, you now have a great opportunity to boost the employment of young work seekers.

What is it?

The ETI is an incentive aimed at encouraging employers to hire young work seekers. It was implemented with effect from 1 January 2014. 

What are the benefits for employers?

The benefits of the ETI are:

• It will reduce the employers cost of hiring young people through a cost-sharing mechanism with government, by allowing you to reduce the amount of  Pay-As-You-Earn (PAYE) you pay while leaving the wage received by the employee unaffected.
• For example, employers who are registered for PAYE, and who employ a person for the full month of February 2014 and earns R2000, will get R1 000 off their monthly PAYE liability (provided that the employee is a qualifying employee based on all the other remaining requirements). For more information on how the ETI works, click here.
• Employers will be able to claim the incentive for a 24 month period for all employees who qualify. Click here for more information.
• The incentive amount differs based on the salary paid to each qualifying employee and whether the qualifying employee was employed after the inception of the ETI programme on 1 October 2013. ETI may only be claimed for a total of 24 qualifying months. Click here for more information.
• This incentive will complement existing government programmes with similar objectives e.g. learnership agreements.
• The aim of the ETI is to facilitate the increased employment of young work seekers.

Who qualifies?

• The employer is eligible to claim the ETI if the employer–
• Is registered for Employees’ Tax (PAYE), or must be eligible to register for PAYE (e.g. the employer can't register just to claim ETI, other registration requirements must be met)
• Is not in the national, provincial or local sphere of government
• Is not a public entity listed in Schedule 2 or 3 of the Public Finance Management Act (other than those public entities designated by the Minister of Finance by Notice in the Gazette)
• Is not a municipal entity
• Is not disqualified by the Minister of Finance due to the displacement of an employee or by not meeting the conditions as may be prescribed by the Minister by regulation.

Top Tip: To work out if you are a qualifying employer click here.

How do I determine who is a qualifying employee?

Top Tip: There is no limit to the number of qualifying employees that an employer can hire.

 

An individual is a qualifying employee if he or she–

• Has a valid South African ID, Asylum Seeker permit or an ID issued in terms of the Refugee Act

• Is 18 to 29 years old (please note that the age limit is not applicable if the employee renders services mainly inside a special economic zone (SEZ) to an employer that is operating inside the SEZ

Rob Davies - Act 1 Scene 1 - the demise of white monopoly capital. A play in one scene

[Enter Post Title Here]

The scene – a room in a prime office in Meintjies Street Pretoria.  A nondescript bearded man in a Mandela shirt is reading the news online whilst he fondles his made-to-scale replica of Marx’s gravestone.

Man (muttering) – who the hell is Alan Hirsch anyway?  What does he mean the president needs to bear in mind that “more certainty is needed about policies on mining, land and black economic empowerment to encourage new investment.” There’s plenty of certainty, we have conducted empirical research – there is absolute certainty that the white monopolistic capital will fall and the economy will be nationali…………

The phone rings

Man – Davies.

Secretary – Minister, I have Twusi Vala on the line for you.

Twusi – hello is that bolshie bob, I mean minister davies?

Bolshie bob, emphasising the uppercase – it’s Minister Davies to you Mr Vala (under his breath – if I ever get my hands on that blogger who gave me that name, I’ll……..)

Twusi – listen minister I have a problem.  I own 100% of my business.  I was born in Hammanskraal and I employ skilled white people and foreigners and I can’t get a BEE certificate because my turnover is over R50m.  My clients don’t want to know me.  I’m non-compliant.

Bolshie bob – you know that you could implement all the other elements in the scorecard and get a good score – your ownership and management etc look  good.

Twusi – listen minister, I didn’t join the struggle to be poor.  Those elements are just too hard to implement.  They cost too much money and take much time.  Anyway how I am supposed to train black people if I only employ whites and foreigners?

Bolshie bob – our intention was always to favour you but only up to a poi……………………

Twusi – I don’t care. This is not fair – fix it otherwise I will raise this at the highest levels of government, I mean the ANC

The man returns to the article he was reading.

Bolshie bob – doesn’t this Alan Hirsch know that the Chinese are breaking down the doors to invest here – what policy uncertainty is this?

The phone rings again

Bolshie bob – Davies.

Secretary – Minister, I have Rivian Veddy on the line from Durban.

Bolshie bob – Rivian, so good to speak to you again

Veddy – cut out the small talk comrade minister.  I didn’t join the struggle to be poor.  I’ve been subsidising the rural house of zoomer for years. All I want in exchange is all the lucrative contracts in KZN.  This fucking Nene is now putting the brakes on my supply chain connections.  I need a BEE certificate.  I turnover close to a billion (that SARS knows about).  How the hell am I going to get that level 1 that I faked, I mean declared up until now.  Now it’s about checking financials and shit like that.  Have you seen how your revised codes have marginalised Indians?  I have a family to support and they are worth shit on your new scorecard.  The monarch from the rural house of zoomer is now demanding more cash and I can’t get this out of the state contracts that I am entitled to.  Get me a certificate now or I’ll take it up with the highest echelons in government, I mean the ANC.

Phone goes dead. Davies starts looking through his red rolodex.  The phone rings again

Secretary – Minister, I have Tendai Preneur on the line for you.

Bolshie bob – Mr Preneur, we’ve not spoken since Malusi naturalised you. 

Tendai – naturalised at great expense minister.  There isn’t a single verification agency that will recognise me as black now – in the past it was an affidavit.  Now I go for a verification and they tell me I’m white.  White!! Me!! – the closest thing I ever came to white was when I took that farm in Mazoe.  Now that bob, is he a relation of yours – what with you having the same first name, has been booted out of government in Zim I need to make my fortune here.  This is unacceptable.  Malusi does not come cheap and I’m still white!!!

Rattled the bearded man scrolls through his rolodex and calls his secretary.

Bolshie bob – please get the awesome awdoz on the phone.

Secretary – I think you mean the Acting BEE Commissioner, Minister

Boshie bob – that blogger again! if I ever get my red claws on him.  Yes her – I wish to meet the Acting BEE Commissioner urgently.

Five minutes later a knock is heard on the door.

Bolshie bob – come in.

Awesome awdoz – Minister, you called for me.

Bolshie bob – yes Commissioner.  We have a problem here.  I have just taken three phone calls in five minute, black business is revolting because they can no longer comply with the BEE codes because they are too hard or too complicated……..

Awesome awdoz – or it just takes too long to get a BEE certificate?

Bolshie bob – Exactly.  When we put these revised codes in place we designed them to make it almost impossible for white companies to comply so that we could give black business a hand up.  I never expected that these black businesses would get so much business and then turn over more than R50m.  That wasn’t the plan, they aren’t supposed to be emulating these white monopolistic capitalists.

Awesome awdoz – these white businesses are devious.  Do you know that they have found a way to get around the 51% ownership rule using the modified flow through principle.  Try as I might to discourage this behaviour they have carried on regardless. 

Bolshie bob – have you seen that some of these companies are doing better under the new codes than they did under the old codes.  This is an untenable situation – we need to punish them more.  Do you have any ideas

Awesome awdoz – we must get rid of the modified flow through principle resulting in instant promotion to a level 2 immediately.  But we can't leave it at that.

Bolshie bob – what else did you have in mind?

Awesome awdoz – let’s just promote large black businesses that turnover more than R50m to a level 2 or 1 so that you can appease your constituents.

Bolshie bob – awesome idea awdoz, I mean Commissioner (if I get my hands on that blogger).  But let’s not make it too easy for the white monopoly capitalists to get to that 51% black ownership level through some nefarious scheme.

Awesome awdoz – we could remove the modified flow through principle and insist that large companies undergo an ownership verification.  There’ll be no modified flow through principle then.

Boshie bob – exactly.  But why should we stop there?  I see the president has launched the Youth Employment Service.  Let’s bring that into the scorecard. Hell, whilst we are at it I think we should also get white business to fund tertiary education.  We need to make it a little costly so that they rapidly become financially unviable.  Do you see it Commissioner – we’ll crush white businesses with paperwork and expense.

Awesome awdoz (pondering) – I’ve got an idea.  How about we split up the skills development spend into two sections.  Half to be spent on black staff and the rest on bursaries. 

Bolshie bob – awesome plan aw… I mean Commissioner.  Maybe we should sweeten the deal a little. Not split it halfway – perhaps 3.5% on black people and 2.5% on bursaries.  Do you see the brilliance in your plan?

Bolshie bob does not wait for an answer

Bolshie bob – the 3.5% of payroll figure can be made up of internal spend and salaries.  The bursaries are a raw cost – straight off the bottom line.  I’ve heard that this will cost Standard Bank about R400m a year.  They’ll have to raise their bank charges to make up this shortfall.  We’ll create a black bank that doesn’t need to worry about these expenses that will undercut the large institutions.  We will be rid of white monopoly capital in a short time.

Awesome awdoz – splendid idea, those concepts had been bobbing in my mind for a while.  You’ve banged the nail on the head there Minister.  But what about the Youth Employment Service.

Bolshie bob – yes, the YES.  Hmmm – those white monopoly capitalists have been very reluctant to hire the black youth, that’s why our universities are full of disgruntled students.  Can we not tie the YES into this in some way?

Awesome awdoz – how about this for an idea?  We incentivise the white monopoly capitalists to embrace certain YES targets and they might be promoted a level.  They’ll never get to the levels that black businesses are automatically promoted to anyway – I say let’s leave them to employ the youth and black business can continue doing business.

Bolshie bob – I like that idea.  But we can’t make it that easy.  We need to put in a few punitive caveats………….

Awesome awdoz (jumping off the couch) – they can only be promoted if they get all the points for the bursaries!!!!

Bolshie bob – by Stalin, you’ve got it.  And the promotion to an extra level will be very attractive to 51% black-owned businesses too should they ever want to get to a level one.  We'll be seen as very fair and reasonable.

Awesome awdoz – thank you minister I’ll get onto drawing up the amendments to the BEE codes.  I suppose under Cyril’s government we’ll have to send them out for comment.

Bolshie bob – I suspect that we’ll have to read and consider the comments too. Sometimes I miss the last president.  Now if I could just get my hands on that blogger – I’d send him off to Siberia for a winter holiday……

The curtains come down to no applause – the play started four hours late and the audience had long gone home before the performance started.

Trainee Tracking Tool - here's one I created

How SANAS loves its paperwork.  This is a spinoff from bolshie bob's desire to create paperwork and red tape.  How this is going to result in transformation resides only in his red mind.  

The internet was trawled for a trainee tracking tool.  There are some third party systems you can use.  Unfortunately the bee commission doesn't help either - they merely state that every company should develop their own.  This is what I would put in a trainee tracking tool.  Just headings - you can fill in the detail as you go along.  Understand that this is for verification - so you should pad it with lots of documents. ID books, payslips, test results, psycho-analyses, spinal taps and the results of the most recent pencil test.

Trainee Tracking Tool

1. Learner name, ID number, race gender
2. Type of learnership/internship/apprenticeship (name)
3. Ultimate qualification
4. Duration of learnership
5. Date started and anticipated completion date

6. Was the learner employed by the company before the learnership commenced.

7. Progress report (quarterly)
8. Examinations written (date and whether the learner passed)
9. Moderator/assessor’s report on the progress in that quarter

10. Other interventions required to assist the learner (courses, internal training etc)

Signed by moderator/assessor

Date

Good luck using it, tell SANAS I sent you.  And as usual, if you like the tool please send me a mail. In fact I would really appreciate one that has been completed.

New codes on the cheap – not likely. Want more of this then vote ANC

Not that I have ever voted for the DA.  It doesn't matter who I vote for, what does matter is why.  I vote because I want to reduce the ANC's power.  I once heard the Helen Zille would love to vote for the ANC, she feels that the ANC should have been a good home for her.  But alas the crony incompetence of the ANC forced her into the opposition.  I can relate.

I always post an anti-ANC post before an election.  The news is full of how Zuma uses feudal methods to retain loyalty, part of this is to hire grossly incompetent people in positions (Hlaudi, Dudu, Muthambi and many others) of power.  Most of his cabinet are suurstofdiewe, hopelessly out of their league and blissfully unaware of this fact.  Alas Rob Davies, aka Rob the Red or Bolshie Bob is not one of those.  He's not stupid he's just a rotten commie who has been given a free reign on the economy and is wantonly destroying it.  He is obviously very inspired by Zuma's policy of hiring incompetents because his department is fraught with such people.

You imagine Bolshie taking on the job as a national coach of football.  He hires people like me as assistant coaches, knowing that we know nothing about football (and I know NOTHING),  the only guidance he provides is a game plan that the Uruguayans used in 1930 which no longer works. He then buggers off to the sidelines and waits for the impending disaster whilst spewing 1930s football rhetoric and statistics. "If it works then, then it will work now."

What brought this vitriol on was the exercise I undertook yesterday (a large part of yesterday I stress) in creating an assessment of a client's performance of the revised codes. The calculations are ridiculously complicated for me – someone who is rather well versed in these codes. Complexity aside – the sheer lunacy of these codes come to the fore. The table below shows the same client's skills development costs

Race Group	Modified EAP	Target spend per race group	Target spend per person
AM	45.89%	1,452,367.80	44,011.15
CM	6.54%	206,971.33	20,697.13
IM	2.14%	67,800.95	16,950.24
WM	0.00%
AF	38.56%	1,220,417.17	203,402.86
CF	5.64%	178,423.56	178,423.56
IF	1.24%	39,253.18	9,813.30
WF	0.00%

I've harped on about this a lot in the past. But I still cannot understand why the 6% of payroll is justifiable. How on earth is this company going to spend 203k on the training of African women? You could go to sesame bun and ask him what to do and he'll tell you to sponsor black women at university. This is not feasible. It's never going to be feasible. The sad thing about going to sesame bun and the DTI is that he doesn't know what he's doing either, and neither do his minions.

This is Bolshie social engineering at the stroke of a pen and then leaving the implementation of this to those companies that have to figure out what to do. He's enlisted his equally incompetent state-owned entities to blam this message home, they are equally clueless and just as protected as Bob is.

This is the product of the ANC, if you wish to perpetuate the status quo then be sure to vote Zuma. But the Zimbabwean example has shown that regimes like this will come undone. And when that happens…………… IT'S TOO FUCKING LATE!!!!

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Regional and national EAP, Bolshie Bob content

[E]mployment opportunities are accessible to people only where they live.  The objective of the EE Act is not to induce racial migrations to accommodate the statistics.  Its objective is accessibility of employment opportunities and it achieves that objective only if it takes account where applicants for the posts are located.  Statistics that serve as a tool for that purpose will be statistics that reflect the reality of the population, and the reality is that the races are not distributed uniformly throughout the country, which is not reflected in the Department’s Plan.

The Employment Equity Act has since been changed and it no longer requires an employer to take into account regional demographics when devising EEP targets – it merely allows it to do so if it wishes. It may be that this amendment is unconstitutional because it effectively encourages migration of people far away from their families and communities, thus containing echoes of the apartheid migrant labour system. But a future judgment will have to determine whether this is so.

via feedly.com

So sayeth Pierre de Vos in another of his insightful posts.  As those who are scholars of Rob's Folly also known as Bolshie Bob's Botched Borscht will know that our Stalinist deludinist has found it fit to include the economically active population (EAP) as a target for his racially representative nation. As we have come to expect from the brains trust at the iDioTIc, the document is big on ideology and short on the most basic clue as to how to implement it.

The ConCourt has come to our aid when it comes to regional and national EAP.  You can use both.  The ConCourt referred specifically to an EE plan.  But I feel confident that we can extrapolate this conclusion into the meat of any BEE scorecard scenario.  But you have to read this plan into the IMF's David Lipton's recent speech on the state of the South African economy.

But there is something else going on that has developed with the evolution of the economy. This involves issues that I know are very familiar to you: infrastructure bottlenecks; skills mismatches in the work force; regulations that stifle competition and entrepreneurship and keep that one-third of the labor force unemployed or too discouraged to seek work.

The end result is that a huge part of the labor force is left on the outside looking in, undereducated and with no opportunities for advancement. I’m told, for example, that there are township youth who not only cannot find work, but who grow up without knowing anyone in their circle of family and friends with a job either!

The formal economy is not absorbing them, nor are they able to strike out on their own. There is a crucial structural issue at play here: those included and successful in the advanced economy — large businesses, banks and unionized workers — maintain entry barriers against their potential competitors — small and medium-sized enterprises and the unemployed.

These paragraphs actually refer to the 79% of the EAP that the Prison's Department wants in its employ.  Lipton is telling us that the government has in effect let these people down, both through their historical neglect and their ongoing burdensome policies. And once they have washed their hands of these people by pushing them out the school system the private sector is expected to absorb them and make up their educational shortfall by blowing humongous amounts of cash on skilling them, 6% of payroll to be precise.

We are being taken for fools, policies created by buffoons who are not required to understand how an economy or a spaza shop runs.  This doesn't specifically mean that we can point fingers at Zoomer and his band of incompetents. We are part of the solution but government needs to make the first move - and that move should be axing Zoomer and his cabinet without a pension.

And no, I don't feel better for writing this.

 

 

 

What Nene will not receive, measured in Nkandlas

Yesterday's post looked at the total cost of skills development for 9 companies. This table shows how much less money Nene (and SARS) is going to receive.  For those MPs who are numerically challenged, the total amount is 2.29 Nkandlas. The going rate for a Nkandla is R246m.

Company	Target spend (6%)	Additional spend required over and above current spend of 3%
Standard Bank	887 760 000.00	443 880 000
MTN	402 540 000.00	201 270 000
NASPERS	524 280 000.00	262 140 000
AECI	178 560 000.00	89 280 000
FirstRand	637 200 000.00	318 600 000
Telkom	591 660 000.00	295 830 000
Nampak	212 100 000.00	106 050 000
JSE	24 300 000.00	12 150 000
Nedbank	560 940 000.00	280 470 000
TOTAL	4 019 340 000	2 009 670 000
Tax deduction (28%)	562 707 600.00
NKANDLAS	2.287429268

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Skills training are coming – but how much of cost

The dti'S BROADEDING PARTICIPATION DIVISION have issued the attached notice. It's not very clear when the first certificates will be issued under the new codes because they write English as well as Hlaudi spokes it.

My friends at BEE Matrix reckon business will just get on with it and try and improve their score over time. I don't agree, the ridiculousness of the targets and the sheer cost of implementation will put companies off and then they just won't bother. Yes it'll take a few years but not that many years.

This table is an analysis of thumb sucked JSE listed companies (including the JSE) and the figures could be a bit out. It shows how much many SHOULD have been spent during the period that the Annual Report discusses. Some are 2013 others are earlier. At least we know that the figures will be higher when the new codes kick in. They make for fascinating reading. The larger corporates need to spend a huge amount of money on skills development. Mind you the JSE's target of 24m is not a shabby amount either. What must be borne in mind is that the target spend is DOUBLE (or as the DTI might write DUBBLE) what we're used to. To see this in perspective we need to look at Standard Bank's 2013 annual report. On page 40 it says the company spent R424m, which was 2.9% of payroll (which suggests that my figure of R887m is fairly accurate). Page 131 shows the complete income statement. The Net Profit Before Tax figure for that year was R13.124bn. If we now add on the tax deductible amount of R463.76m off that amount it comes to R12.660bn. That's a fair drop in profitability. This means less money is spent on tax, enterprise development and most importantly SED.

			Target Race Group
Company	Salary bill	Target spend (6%)	AM	AF	CM	CF	IM	IF
Standard Bank	14 796 000 000	887 760 000	407 348 726	342 293 033	58 049 696	50 042 841	19 016 280	11 009 425
MTN	6 709 000 000	402 540 000	184 705 502	155 207 080	26 321 669	22 691 094	8 622 616	4 992 041
NASPERS	8 738 000 000	524 280 000	240 565 908	202 146 291	34 282 120	29 553 551	11 230 349	6 501 781
AECI	2 976 000 000	178 560 000	81 932 266	68 847 260	11 675 851	10 065 389	3 824 848	2 214 386
FirstRand	10 620 000 000	637 200 000	292 379 256	245 684 780	41 665 840	35 918 828	13 649 154	7 902 142
Telkom	9 861 000 000	591 660 000	271 483 224	228 125 953	38 688 027	33 351 747	12 673 664	7 337 384
Nampak	3 535 000 000	212 100 000	97 322 097	81 779 256	13 868 997	11 956 032	4 543 292	2 630 327
JSE	405 000 000	24 300 000	11 150 056	9 369 335	1 588 952	1 369 786	520 519	301 353
Nedbank	9 349 000 000	560 940 000	257 387 351	216 281 263	36 679 278	31 620 068	12 015 626	6 956 415

Oh yes you can take the money you don't spend and distribute it EAP-fashion amongst the poor for education purposes. I'm not aware of many investors that would go for this. Are you in the business of banking or handing large amounts of money out on bursaries?

And then there is the issue of productivity vs training. The skills development code appears (you can't say anything more than that with the revised codes, everything "appears"" and nothing is clear) to require companies to spend money on SAQA-aligned programmes. As a multinational you can't send your employees on training back at your parent unless you can show that it "meets SAQA's requirement for recognition". Using Nedbank as an example. Their annual report (page 21) gives a total staff complement of 28,748. Average annual spend per person needs to be R19,512.32. I don't know what the percentage of EAP staff there are but that trainng figure per person is going to be much higher. When are these people going to work?

Who stands to benefit here?

You can't spend R19.5 k on the training of a lowly messenger. You'll never see them at work. It was Anglo who pointed out in their comments of the codes that it just makes sense to throw huge and ugly amounts of skills spend on the educated and higher-up-the-hierarchy Africans. I wouldn't be surprised to see a number of connected people informing Nampak that if they pay for their kids' Michaelhouse school fees they'll get BEE points. Broad-based my foot!

And these codes are broad-based? Not likely and the South African public wants them, champing at the bit they are. At some stage something is going to give and I hope to hell that this realisation doesn't come too late. Every day more of our rights are eroded by poor legislating and we just take it.

As a postscript - we know the codes are truly trying to remove white people from the workplace - or only those white people that fit in with the EAP statistics may work in each organisation (white male 6.4% and white women 6.9%).  You still have an obligation as an employer to train your white staff as well.  This is over and above the 6%.   

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Malema’s marchers strangers to world of work - Linda Master

The world is moving into unpredictable socioeconomic terrain. South Africans need to take responsibility and work themselves out of unemployment. There are very few adults who cannot learn something at almost any age. If only the marchers would shift their focus away from Malema’s exuberant fantasy life towards focusing on establishing and supporting microbusinesses. Tiny businesses may never make them rich, but will certainly go a long way towards healing the devastating indignity of unemployment.

via www.businessday.co.za

Tragically apt - South Africa cannot afford to lose another generation.  Throwing ED money at these people is not going to work either.