At Skills Development Corporation, we’re all about making a real impact. We believe that B-BBEE skills development isn’t just about ticking compliance boxes; it’s a powerful tool for transformation – both for individuals and for your business. Investing in your employees and even unemployed individuals with essential skills is a strategic move that earns you valuable points on your B-BBEE Skills Development Scorecard while genuinely making a difference.
Skills Development: A Cornerstone of Business Strategy
Think of skills development not just as a B-BBEE requirement, but as a vital part of your overall business strategy. By aligning talent development with your current and future business needs, you’re building a more capable and adaptable workforce.
This is why it’s crucial for your executive team to champion B-BBEE compliance, and for your HR team to be empowered to implement the strategies that will help you meet your targets. When skills development is linked to individual growth and career progression, it becomes even more impactful and successful.
Earning Points on the Skills Development Scorecard
The B-BBEE Skills Development scorecard offers a clear pathway to earning points by investing in people. Here’s a breakdown of how you can accumulate those valuable points:
- Investing in Learning Programmes: Points are awarded for expenditure on relevant learning programmes for black individuals (Africans, Coloureds, and Indians), with extra recognition for training black employees with disabilities.
- Supporting Higher Education: Providing bursaries for black students attending accredited higher education institutions also contributes to your score.
- Learnerships, Internships, and Apprenticeships: Engaging black individuals in these structured work-based learning programmes is a key way to earn points.
- Absorption into the Workforce: A significant boost in points comes from absorbing black individuals who complete learnerships, internships, or apprenticeships into employment within your company or even your industry.
For Generic Companies (those with an annual turnover exceeding R50 million), there’s a target to spend 6% of your payroll on B-BBEE Skills Development to maximise your points in this category.
Beyond the Scorecard: Tapping into Tax Benefits
Here’s some great news: your investment in skills development, particularly through registered learnerships, can also offer attractive tax benefits!
Section 12H of the Income Tax Act provides a valuable incentive for employers who enter into registered learnership agreements. This comes in the form of tax deductions, designed to encourage both skills development and job creation. These deductions include:
- An Annual Allowance: You can claim a deduction in any year of assessment where a learner is part of a registered learnership agreement.
- A Completion Allowance: An additional deduction is awarded in the year the learner successfully completes the learnership.
The maximum deductions you can claim are currently:
- R80,000 per learner per year for abled learners (typically spread over the two years of the learnership).
- R120,000 per learner per year for disabled learners (also typically spread over the two years of the learnership).
This means you can claim the annual allowance in the first year (often a pro-rata payment) and the completion allowance (the balance due) in the second year upon successful completion.
Making a Real Difference: More Than Just Compliance
We can’t stress this enough: skills development should be more than just a compliance exercise. It’s a powerful opportunity to empower individuals, whether they are existing middle management, unemployed youth, or persons with disabilities.
By identifying and addressing skills gaps through targeted programmes like learnerships, internships, and apprenticeships, you’re not only improving your B-BBEE score but also:
- Motivating your HR team to recruit strategically, bringing in individuals with the skills your business needs.
- Directly contributing to tackling youth unemployment in South Africa.
Furthermore, actively including persons with disabilities in your skills development initiatives can earn you four extra points on your scorecard. As a QSE or Generic Company, aiming to spend 5% of your payroll on learnerships, internships, and apprenticeships for black individuals, including those with disabilities, is a target to strive for. Remember, the learners don’t always need to be your existing employees; they can be placed within your industry. Plus, you earn bonus points based on the percentage of these learners you ultimately employ, showcasing a tangible impact.
Partner with SDC for Impactful Skills Development
Choosing the right partner for your skills development journey is key to making a positive impact and optimising your B-BBEE contribution. At Skills Development Corporation, our thorough process, from sourcing to vetting, ensures you receive comprehensive services designed for success.
We’re here to help you make the right choices for your business, ensuring your skills development initiatives are strategic, impactful, and contribute meaningfully to both your B-BBEE level and a more skilled South Africa.
For more information on how we can help your business thrive through B-BBEE skills development, visit https://sdcorp.co.za/
