The Skills Development element is a priority element on the BEE Generic Scorecard. This element permits measured entities to be scored on and awarded BEE points for doing accredited training, Bursaries, Learnerships, Internships, Apprenticeships and informal training for black people (African, Coloured and Indian).
This element amounts to 20 points on the Generic Codes of Good practice scorecard, which is an indication of how important this element is to BEE. As Skills Development is a priority element, you would need to reach a sub-minimum of 40% of the 20 points on this element to avoid dropping a BEE level. For example, if a business reaches a Level 7 on their BEE scorecard but does not reach the sub-minimum points for Skills Development, they will drop one level to a Level 8.
In terms of the Generic Scorecard, you need to ensure your Skills Expenditure is also done in line with the Economic Active Population (EAP) targets. This means that you must spend your targets for training, Bursaries and Learnerships on African, Coloured and Indian people.
The requirements of the Skills Development Element on the Generic Codes of Good Practice scorecard are as follows:
- 3.5% of Skills Development Expenditure on Learning Programmes specified in the Learning Programmes Matrix for Black People as a percentage of leviable amount. This means that 3.5% of your payroll must be spent on black people according to the EAP target breakdown. An example of this is paying for an African, Coloured and Indian, male and female, to do an accredited course or Learnership.
- 2.5% Of Skills Development Expenditure on bursaries for Black Students at Higher Education Institutions – This means that 2.5% of your payroll must be spent on Black People according to the EAP Target breakdown. An example of this would be paying for an African, Coloured and Indian, male and female, to study at an accredited higher education institution.
- 0.3% Of Skills Development Expenditure on Learning Programmes specified in the Learning Programmes Matrix for Black employees with disabilities as a percentage of leviable amount – This means that 0.3% of your payroll must be spent on a black employee with disabilities. EAP targets do not apply to the disability indicator.
- Learnerships, Apprenticeships and Internships – Number of black people participating in the above as a percentage of total employees must be 5% – This means that 5% of your employees must be either on Learnerships, Apprenticeships or Internships. An example would be if you have 100 employees, 5 black employees must be on either of the above. EAP Targets do apply to this indicator.
In our view, the best way to utilise your skills spend is to offer a Learnership, specifically to a disabled African male and female, as this carries a significant number of points across multiple indicators under the Skills Development element.
When considering the above options, it is also important to keep the following in mind:
- All skills spend must be made within your financial year;
- The amount spent, excluding VAT, will be taken into consideration towards skills expenditure;
- Mandatory sector training does not count for BEE points, e.g. First Aid courses, Fire-Fighting, Health and Safety training.
The pre-requisites for claiming under the Skills Development element are the following:
- Payment of your Skills Development Levies to SARS;
- Registration with your relevant SETA;
- A submitted Workplace Skills Plan that is approved by your relevant SETA; and
- Your business must have implement a plan to develop the priority skills of black employees.
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