BBBEEforEducationNGOs

CRACKINGTHECODESMarch2017

PeterRossandNicoleCopley

Findingourway:

CRACKINGTHECODESMarch2017

PeterRossandNicoleCopley

ToB-BBEE ortoBEE?

BasicConceptsandDefinitions

DefinitionofBlackPeople:GenerictermwhichmeansAfricans,ColouredsandIndians(andChinese?):• WhoareRSAcitizensbybirthordescent,OR• WhobecamecitizensofRSAbynaturalisation–o Before27April,1994o Onorafter27April,1994andwhowouldhavebeen

entitledtoacquirecitizenshipbynaturalisationtothatdate.

QSEScorecard

REVISEDBBBEECODES QSESCORECARD

HIGHLEVELTARGETS

QSESCORECARDIndicatorweighting

Indicatortarget

Ownership(PriorityElement) 25,0 25%ofEquity

ManagementControl 15,0 50%- 88%

Skillsdevelopment(PriorityElement) 25,0 6%

EnterpriseandSupplierDevelopment(Priorityelement) 30,0

Preferentialprocurement: 20,0 80%

Supplierdevelopment: 5,0 2,00%

Enterprisedevelopment: 5,0 1%

Socio-economicdevelopment 5,0 1%

TOTAL 100,00

GenericScorecard

REVISEDBBBEECODES GENERICSCORECARDHIGHLEVELTARGETS

Indicatorweighting

Indicatortarget

Ownership(PriorityElement) 25,0 25%ManagementControl 19,0 50%-88%Skillsdevelopment(PriorityElement) 20,0 6%EnterpriseandSupplierDevelopment(Priorityelement) 40,0

Preferentialprocurement: 25,0 80%Supplierdevelopment: 10,0 2,00%Enterprisedevelopment: 5,0 1%

Socio-economicdevelopment 5,0 1%TOTAL 109,00

GENERICSCORECARD

ProcurementRecognitionTable

ContributionLevel OldCodes AmendedCodes Level

Level One ≥100points ≥100points 135%

Level Two ≥85<100 ≥95<100 125%

Level Three ≥75<85 ≥90<95 110%

Level Four ≥65<75 ≥80<90 100%

LevelFive ≥55<65 ≥75<80 80%

LevelSix ≥45<55 ≥70<75 60%

LevelSeven ≥40<45 ≥55<70 50%

LevelEight ≥30<40 ≥40<55 10%

Non-CompliantContributor <30points <40points 0%

NGOsasSEDbeneficiaries

If75%+ofvaluebenefitsblackpeoplefullvaluemayberecognised

If<75%benefitsblackpeoplevalueXcontributionisrecognised

VeryNBtocalculateandprovethis%(independentcertificationpreferable)

HowSpecialareyou?

“SpecialisedEnterprise”:• Companieslimitedbyguarantee• HigherEducationInstitutions• Non-ProfitCompanies• Publicentitiesandotherenterprisesownedbythestate• PublicBenefitSchemesor• PublicBenefitOrganisations

“Special”EMEs

NPC/PBOunder10mt/overdeemed:• 75%+blackbeneficiaries

level1,135%recognition• 51-75%blackbeneficiaries

level2,125%recognition• <51%blackbeneficiaries

level4,100%recognition

“Special”QSEs

NPC/PBO10m-50mt/overdeemed:• 75%+blackbeneficiaries

level1,135%recognition• 51-75%blackbeneficiaries

level2,125%recognition• <51%blackbeneficiaries

useSpecialisedQSEscorecard

Toprovedeemedstatus

ToaccessdeemedstatusasEMEorQSE,eachyearseniordirectorofNGOsignsandswearstoanaffidavit:• turnoverforthepastyearis10m/lessOR

50m/less;and• %ofblackbeneficiaries

(rangeorexact%)

AccessibleScorecardElements

TheMainScorecardElementswillbefocusingonare:

1. SocioEconomicDevelopment2. SkillsDevelopment3. EnterpriseDevelopmentandSupplierDevelopment

SocioEconomicDevelopment

SocioEconomicDevelopmentScorecard

GENERIC&QSESCORECARDIndicatorweighting

Indicatortarget

Socio-economicdevelopment 5,0

AnnualvalueofallSEDcontributionsasa%ofNPAT 5,0 1,00%

NPAT:NetProfitafterTax

SocioEconomicDevelopment

MainPrinciplesapplicabletoSED• Monetaryornonmonetarycontributions• Specificobjectiveoffacilitatingincomegenerating

activitiesfortargetedbeneficiaries• If75%ofvaluedirectlybenefitsblackpeoplethenfull

contributionisrecognised(if<75%thenactual%)• DefinitionofSED:Musthavetheobjectofpromoting

sustainableaccessofbeneficiariestotheeconomy

SocioEconomicDevelopment

ExamplesofSEDcauses• Developmentprogrammesforwomen,youth,people

withdisabilities,peoplelivinginruralcommunities• HealthcareandHIV/AIDSprogrammes• Educationprogrammes,resourcesandmaterialsat

primary,secondaryandtertiaryeducationlevelsaswellasbursariesandscholarships

• Communitytraining,skillsdevelopmentforunemployedpeopleandABETprogrammes

• Arts,culturalorsportingdevelopmentprogrammes

SocioEconomicDevelopment

Someformsofcontributions:

• Grants• Directcosts• Overheadcosts• Developmentalcapital• PaymentstothirdpartiestoperformSED

SocioEconomicDevelopment

WaysinwhichNGOscanbenefitThecorporate:• MakesadonationtowardstheNGO’sbeneficiaries• Providesoldstockforfreeoratadiscounteg food,

clothing• ContractstheNGOasaserviceprovidertodevelop,

coach,mentorortrainblackbeneficiaries• ProvidestheNGOwithfreeofficesorpaysforoffice

rentals• Providescapitaltopurchaseneworusedequipment• FundstheNGO’stransportcosts

SocioEconomicDevelopment

PBOswiths18AstatusDoublebonus:Corporatesliketogetthe18Adeduction(upto10%taxableincome)aswellas theBEEpointsNote:• notallPBOshave18A(educationshould)• onlycash/assetdonationsqualifyfor18A

SkillsDevelopment

SkillsDevelopmentScorecard(Generic)

GENERICSCORECARDIndicatorweighting

Indicatortarget

Skillsdevelopment(PriorityElement) 20,0

Skillsdevelopmentspendforblackpeopleasapercentageofleviableamount(Referlearningprogrammematrix) 8,0 6,00%

Skillsdevelopmentspendforblackemployeeswithdisabilitiesasapercentageofleviableamount(referlearningprogrammematrix) 4,0 0,30%

BlackemployeesparticipatinginLearnerships,ApprenticeshipsandInternshipsasa%ofallemployees 4,0 2,50%

Blackunemployedpeopleparticipatingintrainingspecifiedinlearningprogrammematrixasa%ofallemployees 4,0 2,50%

Bonuspoints:Blackpeopleabsorbedbythemeasuredandindustryentityattheendofthelearnershipsprogramme 5,0 100,00%

SkillsDevelopment

LearningProgrammeMatrix– Summary• CategoryA:Bursaries– Full-timestudy.Degree:University,

college,schoolorABETprovider• CategoryB:Internships– Mixedmodeinstitutionalinstruction

andsupervisedworkplacelearning.Degree:University,college,schoolorABETprovider

• CategoryC:Learnership – Registeredstructuralexperientiallearningintheworkplaceafterachievementofaqualification

• CategoryD:Apprenticeship:Workbasedlearningthatrequiresformalcontract.SAQAregisteredqualification

• CategoryE:Work-integratedlearning:Workbasedlearningthatdoesnotrequireformalcontractbutisformallyassessed.Creditsforunitstandards,CPD,PerformanceDevelopmentProgramme

SkillsDevelopment

LearningProgrammeMatrix– Summary• CategoryF:InformalTraining– Informalinstructional

progammes.Workshops,seminars,conferencesandshortcourses.

• CategoryG:InformalTraining– Workbasedinformalprogammes intheworkplace.Onthejobtraining.

CategoryAtoEprogrammesarerecognisedinfull.CategoryFandGarecappedat15%oftotalSDexpenditure

SkillsDevelopment

MajorChangesintheAmendedCodes• GenericscorecardSDtargethasdoubled from3%to

6%ofannualpayroll• Referencenowmadetoblackpeople asopposedto

blackemployees• Thetargetsandpointsbasedonoveralldemographic

representationofblackpeople• SkillsDevelopmentisapriorityelement. Failureto

achieve40%ofthetotalpointswillresultindiscountingbyonelevel

SkillsDevelopment

• ContributetoSA’seconomicgrowthandsocialdevelopmentgoals.

• Creationofdecentworkandsustainablelivelihoods• Developindustrialskillsbaseinproductionand

manufacturing• Supportprofessional,vocational,technicalandacademic

learningthroughworkintegratedlearning,apprenticeships,learnershipsandinternships

• Supportinitiativesresultinginemploymentcreation

Note:MustbecompliantandhavelodgedWorkplaceSkillsPlan,AnnualTrainingReportandPivotalTrainingreport

SkillsDevelopment

RecognisableTrainingExpenses• Coursefees,bursariesandscholarships• Salaries,wagesorstipendspaidtoalearnerparticipating

inLearnership,InternshiporApprenticeship• Costoftrainers• Costoftrainingfacilities• Administrationcosts• CostofSkillsDevelopmentFacilitatorortrainingmanager• Ancillarycostssuchasaccommodation,travellingand

cateringbutcannotexceedmorethan15%oftotalSDexpenditure

NGOsandSkillsDevelopment

• Identifysuitablecandidatesforbursaries,internships,learnerships andapprenticeships

• ProvideNQFalignedtrainingcoursestocorporatesforemployeesor unemployedblackpeople

• ProvideanEmploymentEquityorSkillsDevelopmentcomplianceserviceeg lodgingstatutoryreturns

• Provideskillsdevelopmentfacilitatorservice• Findsuitableunemployedcandidatesfortraining• ProvideABETtrainingservicetocorporates

EnterpriseDevelopmentandSupplierDevelopment

GENERIC SCORECARDIndicatorweighting

Indicatortarget

Enterprisedevelopment:

Annualvalueofallenterprisedevelopmentcontributionsasa%ofNPAT 5,0 1,00%Supplierdevelopment:

Annualvalueofallsupplierdevelopmentcontributionsasa%ofNPAT 10,0 2,00%BonusPoints:

BonuspointforgraduationofoneormoreEnterpriseDevelopmentbeneficiariestoSupplierDevelopmentlevel 1,0

BonuspointforcreatingoneormorejobsdirectlyasaresultofSupplierDevelopmentandEnterpriseDevelopmentinitiatives by theMeasuredEntity 1,0

QSESCORECARDIndicatorweighting

Indicatortarget

Enterprisedevelopment:

Annualvalueofallenterprisedevelopmentcontributionsasa%ofNPAT 5,0 1,00%Supplierdevelopment:

Annualvalueofallsupplierdevelopmentcontributionsasa%ofNPAT 5,0 1,00%

BonusPoints:

BonuspointforgraduationofoneormoreEnterpriseDevelopmentbeneficiariestoSupplierDevelopmentlevel 1,0

BonuspointforcreatingoneormorejobsdirectlyasaresultofSupplierDevelopmentandEnterpriseDevelopmentinitiatives by theMeasuredEntity 1,0

EnterpriseDevelopmentandSupplierDevelopment

• EDcontributions aremonetaryornonmonetaryinitiativesmadewiththeobjectiveofcontributingtothedevelopment,sustainabilityandfinancialandoperationalindependenceofEMEsorQSEswhichareatleast51%blackowned

• SupplierDevelopmentcontributions areidenticalexceptthebeneficiariesareexistingmajorityblackownedsupplierstothecorporate

• Thesetwosubelementsbothformpartofapriorityelement.Failuretoachieve40%ofthepointsineachwillresultindiscountingbyonelevel

EnterpriseDevelopmentandSupplierDevelopment

Qualifyingcontributions• Costofservicestoimproveoperationalor

financialcapacityand/orefficiencylevelsofqualifyingbeneficiariesincluding:• Professionalandconsultingservices• Trainingandmentoring

• Developmentofthecapacityofbeneficiaryentitieswhichenablethemtomanufactureandproducegoods/provideservicesnotpreviouslyavailableinRSA

EnterpriseDevelopmentandSupplierDevelopment

SomewaysinwhichanNGOcanbenefit• Providetrainingworkshopsormentoring

programmesfortheowners,managersorstaffofmajorityblackownedEMEsorQSEs

• DevelopthecapacityofbeneficiaryentitieswhichwillenablethemtomanufacturegoodsorprovideservicesnotpreviouslyavailableinRSA

Opportunity:NGOscanprovidetailoredlearningprogrammeswithoutthestringentcriteriaapplicabletoSkillsDevelopment.

EXERCISE!!

1. Whatis/aretheprimaryobjective(s)ofyourNGO?

2. Describeinbroadtermswhoyourbeneficiariesare.

3. Basedonthisworkshopsummarise5waysinwhichyourNGOcanhelpaCorporateearnscorecardpoints.

4. List5corporateswhoyouintendapproachinginthenext3monthstoexplorehowyoucanmeaningfullypartnerswithinamutuallybeneficialway.

BEEforEducationNGOs