Much to everyone’s surprise the Skills Development Element of the Generic companies’ scorecard was amended on 1 December 2019. The Skills Development Element is a priority element and as such this had a big impact on the industry including all generic entities.

We will unpack the numbers behind the amended Skills Development Element of the B-BBEE Scorecard.

1. 3.5% and 6 Points – Skills Expenditure on Black People

The points and targets were reduced for the Skills Development Expenditure on Black People (African, Indian and Coloured) mainly due to the introduction of a new element in the scorecard. The points available are 6 and the target as a % of the leviable amount is 3.5%.

2. 2.5% and 4 Points – Bursaries for Black Students at Higher Education Institutions

This is the introduction of the new element namely Skills Development Expenditure on Bursaries for Black Students at Higher Education Institutions, the target for this element is 2.5% of the leviable amount and the points allocated to this element is 4 points.

3. 0.3% and 4 Points – Skills Expenditure on Disabled Black People

The Expenditure on black disabled people has stayed unchanged with a target of 0.3% of the leviable amount with 4 points awarded for this element of the scorecard.

4. 5% and 6 Points – Skills Development Expenditure on Black People participating in Learnerships, Apprenticeships and Internships

The expenditure target on black people in Category B, C and D training is 5% of the total number of employees with allocated points reduced to 6 points. Category B, C and D training are Learnerships, Apprenticeships and Internships respectively. There is now a clear distinction that this will only be applicable to Category B, C and D training and there is no distinction anymore between employed and unemployed.

5. 100% and 5 Points – BONUS POINTS – Absorption

The target for absorption of unemployed learners is 100% and the points available is 5 points. Noting this is clearly limited to category B, C and D learners only. Absorption has now been clearly defined as permanent employment with contracts appropriately in place.

Important to note that the cap on informal training has increased from 15% to 25% and that the 6% of leviable amount will account for 10 points and not 8 as before.

Below is a representation of the Skills Development Element:

 

The Skills Development Element is a priority element meaning that a discounting principle will be applied if the sub-minimum of 40% is not achieved. We must also pay close attention to submitting your Workplace Skills Plan before 30th April in order to claim B-BBEE points under the Skills Development Element and apply for mandatory or discretionary grants.

The Skills Development Element remains a crucially important topic of discussion when talking B-BBEE compliance and in being a priority element, has the ability to make or break your B-BBBEE compliance. Please contact Apex Transformation Advisory for any of your Skills Development requirements.