Search Results

SA News | 13 February 2023 President Cyril Ramaphosa has announced funding initiatives for small businesses with the intention of creating jobs and growing established small businesses. Delivering the State of the Nation Address (SONA) on Thursday, the President said government plans to provide R1.4 billion to finance over 90 000 entrepreneurs. In addition, government in partnership with the SA SME Fund is working to establish a R10 billion fund to support SMME growth. “Government is looking at the possibility of providing R2.5 billion for the fund and for the balance of R7.5 billion to be raised from the private sector,” President Ramaphosa said. He was addressing a Joint Sitting of Parliament in the City Hall, Cape Town. This year, government will finalise amendments to the Businesses Act to reduce regulatory impediments for Small, Medium and Micro Enterprises (SMMEs) and co-operatives and make it easier for entrepreneurs to start businesses. He said the licensing of the PostBank would lay the foundation for the creation of a state bank that will provide financial services to SMMEs, youth- and women-owned businesses and underserved communities. “As the National Assembly considers the Postbank Amendment Bill, the Postbank is reviewing its service offerings so that it can provide a viable and affordable alternative to the commercial banks,” the President said. In an effort to address the challenge of youth unemployment, the Employment Tax Incentive has been expanded to encourage businesses to hire more young people in large numbers. “Last year I announced that we would be seeking to reduce red tape so that we can rid our country of the unnecessary bureaucracy that often holds us back. “The red tape reduction team in the Presidency under Mr Sipho Nkosi has been working with various departments to make it easier to do business. “It has taken a collaborative approach, working with departments and agencies in areas such as the mining rights system, tourism transport operator licenses, visas and work permits, early childhood development and the informal sector,” the President said. The red tape reduction team was established to improve the business environment for companies of all sizes through a dedicated capacity in the Presidency to reduce red tape. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.sanews.gov.za/south-africa/government-commits-funding-smmes

Paul Janisch | 13 Feb 2023 While relatively new to South Africa, public-private partnerships have incredible potential to deliver on empowerment measures. A recent article indicated that Transnet is considering outsourcing its container corridor between Durban and Johannesburg. The proposal appears to be some sort of an interim solution with the winning bidder handing it back to Transnet in 20 years. To me this seems like a public-private partnership (PPP). It also suggests that state-owned entities (SOEs) may be softening their attitude to these partnerships. PPPs are without doubt the most effective tool the government has to achieve its Black Economic Empowerment (BEE), reconstruction and development programme and other empowerment-related goals. Yet this method of procurement is not making the most of these opportunities. The problem seems to be that the transaction advisors that are used in the early stages of the feasibility study are not suitably aware of empowerment requirements and structures that PPPs would like to achieve in the long term. The majority of these bid documents contain antiquated empowerment requirements that might deliver a narrow type of empowerment structure that ultimately benefits very few people. The empowerment criteria for PPPs are contained in Module 2 of the National Treasury PPP Practice Note of 2004. The practice note precedes the Department of Trade and Industry’s broad-based BEE codes of good practice (COGP) by about three years, but a careful reading of both the COGP and the practice note reveals that they are remarkably similar and that a standard COGP implementation will more than likely cover almost every requirement that Module 2 has laid out. Interestingly the Municipal Service Delivery and PPP Guidelines have deviated from Treasury’s module 2 and incorporated the DTI’s codes of good practice into its requirements – suggesting perhaps that the Treasury module will follow suit in the future. The stated empowerment objectives of PPPs include Increasing levels of black ownership and management Development of local skills Development of supporting entrepreneurship Creation of local jobs (directly and indirectly) It is the last three objectives that tend to be ignored in most PPPs. The management and ownership requirements are pushed to the fore and more often than not benefit people who may not reside or have any roots in the area that the PPP has targeted. It may appear that empowerment has been achieved but, without the required emphasis on local economic development, the local population might come out of this process completely neglected. Perhaps the best way to explain this process is to use an example of a PPP that we worked on in a remote area of the Eastern Cape. Case study The specific project was located in a region that was a labour sourcing area during apartheid. It is still suffering from the chronic ravages of this policy and as a result has virtually no infrastructure, with an economically active population that is mostly female with a high HIV infection rate. It stands to reason that any investment in this area must have some positive impact on the local community. Our job was to ensure that the empowerment requirements would continuously develop that local community. Using both module 2 and the DTI’s codes as a starting point we recognised that the construction phase was unlikely to employ any of the local population on a permanent basis. As such, budgets that would typically be allocated under a standard BEE scorecard were re-allocated to other areas of the scorecard that would see a greater investment in the local community. We specified that the local community (i.e. people living within a 50km radius of the target area) was to be used, because the DTI’s BEE scorecard only speaks of black people – not local people. This means that without specifying local investment it is conceivable that a company operating in this area could be fully compliant by investing in any other area. The facilities’ management scorecard built on the BEE foundations laid by the construction phase and increased the number of local people employed on a permanent basis over a ten-year period. The modifications to the scorecards were within the ambit of module 2. The single most important feature of a PPP is that the Treasury Manual insists that all empowerment requirements are made contractually binding on the winning consortium, with penalties for non-compliance. Of course this requires both the government and the private party to measure their BEE performance. If the prescribed scorecard deviates so far from a standard scorecard then there is no conventional method of measurement. Verification agencies have been mandated to measure empowerment based on either the DTI’s scorecard or a sectoral charter and do not have the legal capacity to measure any other type of scorecard that deviates from these norms. This means that an additional third party has to be contracted to measure and report on this. PPPs are still relatively new to South Africa and their efficacy is not yet fully tested. But there is little doubt that they have incredible potential to deliver on government’s empowerment measures. It is very important that these measures are carefully thought out at the early stages of any PPP, because it may be very difficult to change them ten years down the line when it is realised that they are not achieving what all stakeholders hoped they would. Proper advice at the outset mitigates this risk. Paul Janisch is a BEE consultant with wide experience in the transaction phase of a number of PPPs. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.moneyweb.co.za/news/economy/why-bee-and-public-private-partnerships-could-work/

Bizcommunity | 13 February 2023 President Cyril Ramaphosa announced this on Thursday when he delivered the State of the Nation Address (Sona) at the City Hall in Cape Town. The Employment Tax Incentive is aimed at encouraging employers to hire young and less experienced work seekers. It reduces an employer’s cost of hiring young people through a cost-sharing mechanism with government, while leaving the wage the employee receives unaffected. The employer can claim the ETI and reduce the amount of Pay-As-You-Earn (PAYE) tax payable by the amount of the total ETI calculated in respect of all qualifying employees. This incentive came into effect on 1 January 2014. “Today, our economy is larger than it was before the pandemic. Between the third quarters of 2021 and 2022, around one and a half million new jobs were created in our economy,” the President said. He noted that the Presidential Employment Stimulus has provided work and livelihood opportunities to more than one million people. “Last year, we spoke about the value of the Presidential Employment Stimulus in providing work and livelihood opportunities. The initiative has now created over one million opportunities, reaching every province and district in our country,” he said. Last week, a new cohort of 150,000 school assistants started work at more than 22,000 schools, offering dignity, hope and vital work experience to young people who were unemployed. The President announced that the Social Employment Fund is also recruiting 50,000 participants in its next phase to undertake work for the common good. Meanwhile, the revitalised National Youth Service will create a further 36,000 opportunities through non-profit and community-based organisations. The Department of Home Affairs has also appointed the first cohort of 10,000 unemployed young people to digitise more than 340 million paper-based civic records. “There are now more than three million users registered on SAYouth.mobi, a zero-rated online platform for young South Africans to access opportunities for learning and earning. “This has been done in close collaboration with the National Youth Development Agency, which continues to provide valuable assistance to young entrepreneurs and work seekers,” the President said. The President said that the Presidential Employment Stimulus is also supporting people to earn their own living. Around 140,000 small-scale farmers have received input vouchers to buy seeds, fertiliser and equipment, providing a boost for food security and agricultural reform. “This initiative has led to the cultivation of some 640,000 hectares of land. An impressive 68% of these farmers are women," President Ramaphosa said. The President said that this year, government aims to provide 250,000 more vouchers to small-scale farmers. “These are examples of the difference that government can make in people’s lives through innovation, creativity and commitment,” he said. President Ramaphosa emphasised that the most effective and sustainable way to build an economy is to equip people with the skills and know-how to drive it. “We have therefore been working to strengthen the link between the skills that we develop and the skills the workplace needs. “This year, the National Skills Fund will provide R800m to develop skills in the digital and technology sector through an innovative model that links payment for training to employment outcomes,” he said. The President reiterated government’s call to companies, departments and SOEs to remove the requirement for work experience for young people seeking entry-level positions. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.bizcommunity.com/Article/196/827/235863.html

Mpho Sibanyoni | 10 February 2023 President Cyril Ramaphosa. File photo Image:GCIS The Black Business Council (BBC) has come out in support of President Cyril Ramaphosa's declaration of a state of disaster on the energy crisis. However, the council said it is sharply opposed to Ramaphosa's plan to appoint an electricity minister. "The BBC welcomes the declaration of a National State of Disaster on the Energy crises and will await more details on the matter. However, the BBC is not convinced that an appointment of a Minister of Electricity in the Presidency will contribute anything positive to the ending of loadshedding as this will just add another layer of bureaucracy on an already complicated situation," read the council's statement. The BBC's support of the state of disaster on the energy crisis comes after SowetanLIVE's sister publication Business Day reported that Business Unity SA and Business Leadership SA had raised concerns about the declaration. BBC added that it was concerned about Ramaphosa's failure to mention the broad-based black economic empowerment in his State Of the Nation Address (SONA), signals that "black person you are on your own". "The BBC is disappointed by the omission of the importance of the B-BBEE, especially as the B-BBEE Act is turning 20 years this year. This is a clear indication that government does not take economic transformation seriously. The BBC views this as “black man/woman, you are on your own," said the council. The BBC added that it was skeptical that some of Ramaphosa's Sona promises might be fulfilled. The council, however, said it would only be convinced about the announcements once they are successfully implemented. Ramaphosa in his speech undertook to deal with the electricity crisis, as well as tackling rail and ports challenges. "As we said before, time for too much talk and announcements about intentions is over. It is time for decisive action and implementation. In our considered view, the SONA has missed a call for action as the economy and job creation can not be left to hope," said the council. Ramaphosa said government will finalise the draft Public Procurement Bill to address weaknesses identified by the State Capture Commission and improve efficiency, value for money and transparency. "Our reinvigorated law enforcement agencies are taking firm action against companies and individuals alleged to have been involved in state capture," he said. The BBC said government needed to strengthen the empowerment policy. "The BBC notes the planned finalisation of the Bill and the efforts anticipated to empower women-owned enterprises and would like to emphasise that until and unless the 40% set aside for women and any other marginalised group is entrenched in the PPB, these intensions will remain a pipedream. "The BBC welcomes the announcement of the measures to deal with corruption and crime but once again, will only be convinced when those measures are implemented," it said. "The lack of sufficient funding for black and small businesses hampers the growth of the economy and job-creation and the BBC is displeased that this matter continues unattended." ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.sowetanlive.co.za/news/south-africa/2023-02-10-black-business-council-backs-state-of-disaster-on-power-crisis/

Akhona Matshoba | 13 February 2023 Small businesses have been included in the president’s plans for economic recovery in the coming year. Image: Luis Tato/Bloomberg But national state of disaster declaration raises concerns around how the funds will be distributed. President Cyril Ramaphosa, in his State of the Nation Address (Sona) on Thursday, announced several initiatives to support the recovery of small- and medium-sized enterprises (SMEs), after the events of the last few years battered the sector. Ramaphosa revealed that government, working with the SA SME Fund, will establish a R10 billion fund aimed at supporting SMME (small, medium and micro-sized enterprise) growth. The majority of the funds are expected to come from the private sector, but the president did say that government is investigating the feasibility of contributing R2.5 billion to the fund. He also announced a plan to provide R1.4 billion in financing to the Small Enterprise Finance Agency (Sefa), which will go towards assisting 90 000 entrepreneurs. Read: SA’s SMEs face onslaughts from every direction Plans to assist businesses with their transition to alternative power generation, via the bounce-back loan scheme that government introduced in 2022 to assist businesses with their recovery from the pandemic, were also announced in Sona. While welcoming the government’s plans to support the sector, financial commentator Michelle Austin says it does little help to throw money at a problem if the economic environment does not allow for growth. She tells Moneyweb that to drive real impact, there needs to be a proper vetting of beneficiaries, to ensure that the financial support is directed to businesses that have greater growth potential. “I would say first priority needs to be given to businesses with high growth potential and that have a good, solid plan and government structures.” An entrepreneur just starting out, or a micro or even a medium-sized enterprise, won’t necessarily be able to achieve the desired impact, she says. “We should … concentrate on those high-growth potential companies or individuals who can bring about change and then further are able to invest in the infrastructure, or give back to the fund in a shorter space of time so that there is more to go around.” The funds that are set to be made available to business owners are likely to be distributed under state of disaster conditions, depending on how quickly the relevant stakeholders can get the ball rolling. State of disaster Less than a year after lifting the last national state of disaster, implemented to combat the Covid-19 pandemic, the president on Thursday declared a national state of disaster to deal with the country’s electricity crisis. It is not clear how the implementation of related regulations will affect the distribution of the above-mentioned funds to businesses. Concerns have however been raised that the declaration of a state of disaster may present the perfect conditions for corrupt activity to take place, as was the case during the peak of the pandemic. For Business Unity South Africa (Busa) CEO Cas Coovadia it is also unclear how the legislation will solve the country’s electricity woes. “We welcome the concentration in this Sona on the energy crisis, however we are not convinced that declaring a state of disaster will help address the crisis,” he said in a statement on Friday. “It must be seen as a low point in the life of our society that mismanagement and lack of governance has created circumstances in which a state of disaster has to be declared.” Raymond Parsons, an economist at North-West University Business School, fears that similar misdeeds reported in relation to the Covid-19 pandemic disaster period may resurface if government doesn’t implement the necessary safeguards. “It remains important that South Africa learns the lessons around the handling of the Covid-19 crisis. Safeguards are needed to prevent corruption and the intended role of the Auditor-General is welcome. “It is also important that a national state of disaster to deal with electricity crisis be seen as a temporary solution and that an exit strategy is already being planned,” says Parsons. “Timelines must be set and enforced, with consequences if they are not met. Implementation and accountability are paramount. “To rebuild business confidence political leadership must therefore ensure that, in the aftermath of the Sona, words will be backed by credible action.” Inospace – the owner of serviced logistics parks – believes that instead of providing assistance to help small businesses to migrate from the national grid on loan terms, government should provide the financing without conditions. “Solar tax relief is better than nothing, but this won’t help small businesses survive or bounce back,” says Inospace chief operating officer Jacques Weber. “We thus call on the government to immediately provide unconditional financial assistance to SMEs whose businesses are at an enormous risk of being annihilated by unending load shedding,” says Weber. “While load shedding persists, thousands of SMEs are staring down the barrel, contemplating shedding jobs, lowering production or possibly winding up,” he adds. “The SME segment of the economy does not have the means to get off the grid through costly alternative power solutions.” ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.moneyweb.co.za/news/south-africa/r10bn-fund-for-smes-must-prioritise-businesses-with-scale/

Simnikiwe Mzekandaba | 10 February 2023 The National Skills Fund (NSF) will provide R800 million towards skills development in the digital and technology sector, through a model that links payment for training to employment outcomes. This, in an effort to strengthen the link between the skills developed and the skills the workplace needs, according to president Cyril Ramaphosa. Ramaphosa delivered his 2023 State of the Nation Address (SONA) last night, following disruptions from members of the Economic Freedom Fighters, who were ultimately kicked out of the National Assembly. The president’s address was also clouded by the major socio-economic and basic service delivery challenges the country faces, with the power crisis, high unemployment and an ailing economy at the top of citizens’ concerns. Last night, the president noted the most effective and sustainable way to build an economy is to equip people with the skills and know-how to drive it. As a result, he stated. “We reiterate our call to companies, government departments and state-owned enterprises to remove the requirement for work experience for young people seeking entry-level positions.” An entity of the Department of Higher Education and Training, the NSF provides funding for national skills development initiatives that are identified by the National Skills Development Plan 2030 as national priorities, or are related to the achievement of the Skills Development Act 97 of 1998. The NSF’s funding focus and skills development portfolio is two-pronged. First, a significant allocation of its annual and medium-term budget is aimed towards education and training initiatives such as bursaries and scholarships, learnership and skills programmes, and workplace-based learning. Secondly, NSF funding is aimed at improving the post-school, education and training system, with a focus on capacity-building, investing in skills infrastructure, research and innovation. With a rising unemployment rate, especially among young people, there is increased focus on addressing SA’s technological and skillset shortcomings by upskilling youth. One of the key findings of the South Africa ICT Talent Development White Papershows the country’s digital skills gap and demand for ICT talent continue to be inhibiting factors to the growth of the economy. Furthermore, the 2022 JCSE-IITPSA ICT Skills Survey shows South African organisations are recruiting outside the country’s borders for technologically- and digitally-skilled talent. Ramaphosa indicated that last year, government said it would place over 10 000 TVET college graduates in employment. “We have surpassed that figure and have now set a target for 2023 of 20 000 TVET to be placed in employment,” he stated. “The number of students entering artisan training in TVET colleges will be increased from 17 000 to 30 000 in the 2023 academic year.” According to Ramaphosa, the Department of Home Affairs (DHA) has appointed the first cohort of 10 000 unemployed young people. The young people have been employed to digitise more than 340 million paper-based civic records, with efforts to enhance their skills, as they contribute to the modernisation of citizen services. The DHA’s recruitment project is part of the Presidential Employment Stimulus programme. The president further noted there are now more than three million users registered on SAYouth.mobi, a zero-rated online platform for young South Africans to access opportunities for learning and earning. “This has been done in close collaboration with the National Youth Development Agency, which continues to provide valuable assistance to young entrepreneurs and work-seekers.” In addition, the Presidential Employment Stimulus is supporting people to earn their own living, he stated. “Around 140 000 small-scale farmers have received input vouchers to buy seeds, fertiliser and equipment, providing a boost for food security and agricultural reform. “This initiative has led to the cultivation of some 640 000 hectares of land. An impressive 68% of these farmers are women. This year, we aim to provide 250 000 more vouchers to small-scale farmers.” ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.itweb.co.za/content/LPp6VMrBLjYMDKQz

SA News | 9 February 2023 President Cyril Ramaphosa on Thursday announced that the country will expand its vocational education and training system to produce the skills that the country needs. According to President Ramaphosa, who was delivering the State of the Nation Address (SONA), this will be done through the implementation of the approved curriculum of the three-stream model. This year, he said government plans to finalise the Comprehensive Student Funding Model for higher education. This will be aimed at students who fall outside current National Student Financial Aid Scheme (NSFAS) criteria, reaching those who are known as the “missing middle”. Access to quality education for all is the most powerful instrument we have to end poverty, the President said. He said the country needs to start with very young children, providing them with the foundation they need to write and read for meaning, to learn and develop. “It is, therefore, significant that the number of children who receive the Early Childhood Development (ECD) subsidy has more than doubled between 2019 and 2022, reaching one and a half million children.” In addition, he announced that the Department of Basic Education is streamlining the requirements for ECD centres to access support and enable thousands more to receive subsidies from government. He applauded last year’s matric pass rate of 80%, with all provinces showing improved results. The share of bachelor passes in no-fee schools improved from 55% in 2019 to 64% in 2022. This, he said, means that the performance of learners from poorer schools is steadily improving, confirming the value of the support that government provides to them. “What these results reveal is that there is a silent revolution taking place in our schools,” he said. The President reiterated that schools should be safe and allow for effective learning and teaching. In this regard, he said the Sanitation Appropriate for Education Initiative – known as SAFE – together with government’s Accelerated School Infrastructure Delivery Initiative has built 55 000 appropriate toilets with resources from the public and private sectors. – SAnews.gov.za ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.sanews.gov.za/south-africa/sa-revamp-its-vocational-training-system-produce-more-skills

Sowetan Live | 9 February 2023 The youth continue to bear the brunt of unemployment as the jobless rate among youngsters is much higher than the national average. Image:Antonio Muchave President Cyril Ramaphosa has repeated his call to companies, departments and SOEs to waive the requirement for work experience for young people seeking entry-level positions. Speaking on the government’s plans to encourage youth employment in his State of the Nation Address on Thursday, Ramaphosa said the employment tax incentive has been expanded to encourage businesses to hire more young people in large numbers. Other measures to address the dire unemployment numbers among those between the ages of 15 years and 24 years, Ramaphosa said that last week a new cohort of 150,000 school assistants started work at more than 22,000 schools, “offering dignity, hope and vital work experience to young people who were unemployed”. The Quarterly Labour Force Survey for the third quarter of 2022 reported that youth aged 15-24 years and 25-34 years recorded the highest unemployment rates of 59.6% and 40.5% respectively. Other measures included the Social Employment Fund recruiting 50,000 participants in its next phase to undertake work for the common good, and the revitalised National Youth Service will create a further 36,000 opportunities through non-profit and community-based organisations. The department of home affairs has appointed the first cohort of 10,000 unemployed young people to digitise more than 340-million paper-based civic records. Ramaphosa said there were now more than three million users registered on SAYouth.mobi, a zero-rated online platform for young South Africans to access opportunities for learning and earning. “This has been done in close collaboration with the National Youth Development Agency, which continues to provide valuable assistance to young entrepreneurs and work seekers.” In addition to these, the state had surpassed its target of placing over 10,000 TVET college graduates in employment. “We have surpassed that figure and have now set a target for 2023 of 20,000 TVET to be placed in employment,” he said. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.sowetanlive.co.za/news/south-africa/2023-02-09-ramaphosa-calls-for-scrapping-of-work-experience-requirement-for-youth/

Donna Slater | 9 February 2023 Steinmüller Africa's current Pretoria-based 30 000 square metre facility under roof, which enables one-million productive hours each year. The company also has workshops in Sasolburg and Bethal. Steam generation and high-pressure piping solutions company Steinmüller Africa celebrated 60 years of business in Africa on November 7, 2022. The company started its presence in South Africa in 1962 with nothing but a post box, which was checked only when the company’s first MD Werner Oehler passed through South Africa en route to Australia from Germany. It was at this location that Steinmüller Africa received its first invitation to tender – an Eskom tender for its Grootvlei power station. This invitation to tender led to the company building its first African head office, just outside of the Grootvlei power station, in Mpumalanga, in the 1970s. The company has since conducted ongoing boiler and high-pressure piping maintenance at Eskom’s Arnot, Camden, Duvha, Hendrina, Matimba, Kriel, Tuthuka, Matla, Majuba, Grootvlei and Komati power stations. Industries that have benefitted from Steinmüller Africa’s progression on the continent and beyond include power generation, pulp and paper, chemical and petrochemical and mineral beneficiation. Its milestones are many and the company’s development is linked to South Africa’s industrial growth. The forerunners of this development were the building of boiler plants at Hendrina, Kriel, Duvha, Thuthuka, Majuba and Mathimba power stations from 1967 through to the early 1980s. The 1990s saw Steinmüller Africa increase its South African footprint with the Sasol rejuvenation project, the replacement of make-gas boilers at Mossgas and Iscor blast furnaces. It also expanded its African footprint by undertaking work for the Sappi mill, in Swaziland, and it conducted the refurbishment of the Zimbabwe Iron and Steel Company (Zisco) plant. The South Africa-based entity also took its footprint to Europe where it was contracted to fabricate pulverised coal-fired boilers in Iskenderun, Turkey. Between 2004 and 2010 it also undertook the return to service of mothballed plants at the Camden, Komati and Grootvlei power stations, and began fabrication of boilers and high-pressure pipework at these plants. In addition to its work for Zisco and the Zimbabwe Electricity Supply Authority (Zesa), Steinmüller Africa also has a footprint in Botswana, Mozambique and Namibia. Steinmüller Africa human capital management executive GM Karin Kaempffer says the company’s progression has been linked to South Africa’s industrial development. “Initially – in the early to mid-1990s – our technical expertise was overseas-based and our offering to the African market was largely based on our local capabilities.” She adds that Steinmüller Africa now employs advanced engineering tools in its South Africa-based design office and has invested significantly in automated welding technologies at its fabrication facilities. “Both of these developments are aligned to our drive to improve productivity, shorten lead times and be a premier utility boiler and steam piping service provider on the African continent. Our growth and sustainability, however, has remained within the power generation and chemical sectors. “Our expertise focuses on steam generation and reticulation, with an emphasis on complex, efficient high-temperature and high-pressure steam, meaning we are capable of providing solutions across the entire utility sector, where fuel efficiency is paramount,” says Kaempffer. Steinmüller Africa, which has supported the majority of major power generation and chemical utilities in South Africa, was one of the earliest companies to undertake transformation and localisation activities in line with the broad-based black economic empowerment (BBBEE) scorecard and has been a Level 1 contributor over the past several years. “We are proud to be a highly ethical organisation and a preferred employer in our sector. We have trained and produced a significant number of artisans and technicians for the South African industry,” she says. In addition to its BBBEE rating and local skills development, Steinmüller Africa has contributed significant funding to 24 tertiary institutions across Africa to benefit science and technology undergraduates. “We have covered a great amount of ground over the past 60 years, both geographically and on the innovation front. We look forward to another 60 years of growth, to the betterment of our company, the communities in which we work, and the industrial sectors we serve,” concludes Kaempffer. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.engineeringnews.co.za/article/steinmller-africa-celebrates-60-years-of-growing-its-african-business-2023-02-09

Given Majola | 10 February 2023 The Amended AgriBEE Sector Code 2017, acknowledges the diversity and particularity of sub-sectors within the agricultural sector in South Africa, which is positive, but the wide scope also poses challenges, says Agbiz. File photo Cliffe Dekker Hofmeyr (CDH) yesterday said the Agriculture Sector Codes was still fairly new, but was a step in the right direction. CDH held a webinar yesterday, which focused on the B-BBEE regulatory environment applicable in South Africa in the agriculture and fishing sectors. With the advent of the Agriculture Sector Codes in December 2017, it made it easier to ensure and measure Broad-Based Black Economic Empowerment (B-BBEE) compliance. In CDH’s view it was likely to stay in place to allow the potential benefits and opportunities to crystallise over time. However, in the fishing industry, it said there was no B-BBEE sector code, and the generic code applied, but to a more limited extent. “There is accordingly, no sector specific B-BBEE regime applicable to the fishing industry which continues to apply its own policies and assessment processes which do take B-BBEE into account, but there are no fishing sector specific or relevant criteria in the generic B-BBEE Codes,” the firm said. It said the fishing sector might have to look at developing a B-BBEE sector code in the future, but at this stage it did not appear as if this was on the cards. But the changing nature of the Agriculture Sector Codes remained a challenge, Theo Boshoff, the CEO at Agricultural Business Chamber (Agbiz) said yesterday. Agbiz said promoting inclusive growth in the agro-food value chain was one of their core objectives. “B-BBEE remains directed at big businesses. In this regard, businesses in the value chains have made significant investments into B-BBEE. Investments that are made towards gaining greater recognition can be undermined when codes change. Long-term stability is required,” he said. Agbiz said the fundamental objective of the Act was to advance economic transformation and enhance the economic participation of black people in the South African economy. For this objective to be realised, the Code must be implemented, but there were geographic and financial challenges hampering its effective implementation. “Supplier development can be a powerful tool to aid black businesses throughout the value chain, but the rural nature of agriculture typically results in limited options as far as suppliers are concerned. For farmers, they need to source inputs from companies within the region to avoid exorbitant transport costs. There may therefore be areas where black suppliers are available but likewise, remote areas where the options are limited. “Agro-processors and food companies have invested substantially into developing black farmers and bringing them into their value chains. There are great examples within multiple value chains and some of the leading supplier development programmes empowering black farmers are being implemented by Agbiz members,” Agbiz said. But it said access to funding and the slow pace of land reform in South Africa continued to be a challenge to reaching industry goals and sourcing more produce from black farmers, however there were praiseworthy programmes that had made real progress. Boshoff said likewise, many agribusinesses and co-operatives who supplied inputs to farmers, had comprehensive farmer development programmes. These companies provided technical support, training, skills development and finance to black farmers. “Likewise, many commercial farmers provide mentorship and lend equipment to neighbouring black farmers. While this is very positive, the codes unfortunately provide little recognition for these companies as enterprise development (building black businesses who are not your suppliers) carries little weight in the codes. Here there is a clear mis-match between genuine efforts to build black businesses and the recognition provided by the codes,” he said. Boshoff said the Amended AgriBEE Sector Code 2017, acknowledged the diversity and particularity of sub-sectors within the agricultural sector in South Africa, which it said was positive, but the wide scope also posed challenges. This as the same code sought to cover input suppliers, agro-processors, traders and farmers. These companies operated in vastly different areas with very different issues. “A number of tweaks can certainly be made. For instance, voting rights as a measure of ownership may work for companies but not for co-operatives, which work on the basis of one-member, one vote. Using turn-over as a measurement of an entity’s size is also a challenge for agricultural commodity traders who move product through their books. They typically have a high turnover based on buying and selling stock, but with very low profit margins, thereby giving the impression that they are larger companies than they really are,” he said. Boshoff said elements such as preferential procurement was a challenge for farming as the options for procurement were very limited in deep rural areas. This was also the case with many farming enterprises that do not have multiple tiers of management. “An alternative, a simplified scorecard for primary agriculture should be considered. Overall, implementation and funding remains problematic. Verification is a costly process that adds to the cost of doing business. If the codes can be simplified and mechanisms be put in place to assist implementation (for instance, soft-finance for BBBEE deals), the uptake would likely be greater,” he said. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.iol.co.za/business-report/economy/agriculture-sector-code-is-a-step-in-the-right-direction-says-law-firm-c0de17c8-ea74-4f09-8dac-17199edfddbc

News24Wire | 8 February 2023 SA's highest court has declined to hear an application for leave to appeal a lower court's ruling that found the state was wrong to include Broad-based Black Economic Empowerment (B-BBEE) as a criterion to access Covid-19 relief grants in the tourism sector. In April 2020, as the Covid-19 pandemic caused local and international tourism to grind to a halt, then-tourism minister Mmamoloko Kubayi set up a Tourism Relief Fund. Some R200 million was to be allocated for once-off payments of up to R50 000 for struggling small businesses. The minister included the B-BBEE status level of applicants as one of the criteria for funding. Trade union Solidarity and lobby group AfriForum then took the Department of Tourism to the North Gauteng High Court in Pretoria, arguing there was no need to use "race as a benchmark" for relief. While they lost their initial case, AfriForum and Solidarity won on appeal in the Supreme Court of Appeal (SCA) in September 2021. CODES The minister argued she was bound to include the B-BBEE level of applicants as one of the criteria for relief under the B-BBEE Tourism Sector Code. But the court found that the minister was mistaken, as relief grants administered under the Disaster Management Act could not be viewed as grants "in support of B-BBEE". The SCA said: Her inclusion of the B-BBEE status level of applicants for assistance as a criterion for eligibility for grants from the fund was therefore invalid. The court did not, however, rule that the R200 million already distributed to small businesses should be recovered, noting that neither Solidarity nor AfriForum has asked for this. APPEAL BID The department then applied for leave to appeal the SCA ruling before the Constitutional Court. On Wednesday, the apex court denied leave to the appeal. This means that the SCA's September 2021 ruling stands. In its ruling, the Constitutional Court noted that the issue was "moot" as SA's state of disaster had long been lifted and the funds already distributed. And while it would at times rule on "moot" issues, an increased workload means it must pick and choose its cases carefully. Solidarity deputy chief executive for legal matters, Anton van der Bijl, said that while some could view the case as "academic", it still set an important precedent. It would be harder for the state to include B-BEEE requirements as part of the criteria for relief funds in the future, he said. ‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’. https://www.engineeringnews.co.za/article/concourt-shoots-down-govt-appeal-over-bee-in-covid-19-tourism-funds-case-2023-02-08

Are you aware that, for the most, Broad-Based Black Economic Empowerment (B-BBEE) Practitioners are the weakest link in terms of fulfilling the country’s economic growth framework? Economists have established that increasing the diversity of shareholding, improving skills and expanding small business participation in supply chains are all components which could contribute to economic growth. However, only if it is done strategically by aligning with economic growth principles. The B-BBEE Act (The Act) has specific but broad, qualitative objectives which organisations and B-BBEE Rating Agencies generally choose to overlook in favour of the quantitative measurement benchmark of B-BBEE, namely The Codes of Good Practice (The Codes). However, subsequent amendments to The Actintroduced a risk as to the legitimacy of an organisation’s B-BBEE claims if they fails to recognise the link between The Act and The Codes. The consequence of failing to acknowledge the objectives of The Act could result in up to 10 years imprisonment and up to 10% of a Juristic Person’s annual revenue. Entrusted with defending the principles of The Act, The B-BBEE Commission is responsible for investigating activities that undermine or frustrate the objectives thereof. The mandate of the B-BBEE Commission is not only to evaluate the registrar of ownership transactions and report on the state of Transformation on an annual basis, but to also oversee, supervise and promote adherence to the B-BBEE Act. The mandate of the B-BBEE Commission is not to draft, implement or amend policies, but to provide interpretive guidance based on the objectives set out in the B-BBEE Act. Since being established in 2015, the B-BBEE Commission has increased its capacity and competence, thus increasing the risk to any individual or juristic person who engages in Fronting Practices. The people at risk of being prosecuted for Fronting Practices include, but are not limited to, directors, managers, administrators and B-BBEE Rating Agency employees. The Act leaves no place to hide for those flouting its mandate, as it defines a ‘knowing person’ as one that either had actual knowledge of a matter in question or was in a position in which they reasonably ought tohave known. It extends to a ‘knowing person’s’ obligation to investigate any matter in question to the extent that the outcome would have provided the ‘knowing person’ with the actual knowledge. The question is: if checks and balances were in place, would there be a different outcome? With such checks and balances in place would it be reasonable to assume that a ‘knowing person’ would, in effect, have had actual knowledge of the matter in question? For the most part, organisations have failed to develop internal competencies that create and drive B-BBEE Strategies. Consequently, there is a massive over-reliance on external B-BBEE consultants, B-BBEE Rating Agencies, accountants and lawyers. The Act indirectly defines the Board of Directors, the Executive Committee members and management teams as ‘knowing people’. Such ‘knowing people’, due to their limited technical understanding of B-BBEE, accept guidance from external advisers often without question. Subsequently, by the nature of what they do in their daily functions, they are ‘knowing people’ therefore, they are potentially personally liable and accountable if an organisation is found guilty of Fronting Practices. Considering the risk of exposure such ‘knowing people’ have while carrying out their daily duties, one would think that addressing such internal competencies would be a high priority for them. Solid internal competency is essential as it mitigates the risks to ‘knowing people‘. To achieve this, it is necessary to develop such people through high-quality broad theoretical training on all areas of B-BBEE legislation. It is imperative that ‘knowing people’ have the ability to create a control point so they can manage the B-BBEE process without being exposed to Fronting Practices. Core to mitigating such risk is introducing checks and balances on the processes in line with policy and procedure. This operational governance is imperative so that every ‘knowing person’ is secure in the claims they present for a B-BBEE Audit. Examples of typical Fronting Practices that ‘knowing people’ should be fully aware of include, but are not limited to: Ownership Fictitious Voting Rights claims whereby ‘Black’ People do not exercise these rights; Economic Interest claims with limitations on the utilisation of dividends; Net Value claims where ‘Black’ People do not benefit from the underlying value of their shareholding; Voting Rights claims of ‘Black’ People on the Board of Directors where such ‘Black’ People are not afforded these rights. Skills Development Expenditure claims for ‘Black’ persons living with disabilities whereby they do not meet the criteria of persons with a disability as defined in the Codes of Good Practice on Key Aspects of Disability in the Workplace issued under section 54 of the Employment Equity Act; Failing to confirm that the content of informal training is indeed training in line with the requirements of the Learning Programme matrix. Enterprise & Supplier Development Preferential Procurement expenditure with suppliers that do not qualify as an EME or QSE, otherwise suppliers that are at least 51% ‘Black’-owned, at least 30% ‘Black’- Women-owned or at least 51% ‘Black’ Designated Group Suppliers. Preferential Procurement expenditure where B-BBEE Credentials, presented by organisations without the resources to deliver, form part of the overall claim. Enterprise Development and Supplier Development claims where Beneficiaries do not qualify as per the criteria, or contributions did not meet the required objectives. Socio-Economic Development Claims where the status of the Beneficiaries is not confirmed; Contributions where the requirements did not meet the criteria. In conclusion, my advice to all ‘knowing people’ is always ascertain whether the B-BBEE advice you act on is indeed substantiated and aligns with both The Act and The Codes, whether or not it is for free or if you are paying for it. Be cognisant of the consequences of taking advice that cuts corners. Essentially, organisations should treat their B-BBEE Audit just as they would their financial audit by understanding the dynamics, using qualified suppliers and adhering to legislation in a meaningful and ethical manner.