Newsletter No 11 /25 March 2022
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President Cyril Ramaphosa: Proudly South Africa Buy Local Summit and Expo
President Cyril Ramaphosa’s pre-recorded message to the Proudly SA Buy Local Summit and Expo
It is my pleasure to address this Summit at a time when the Buy Local message is more important than ever.
The economic damage caused by the COVID-19 pandemic has placed even greater demands on our economy to provide employment and livelihood opportunities.
The pandemic has both exposed the fragility of global supply chains and revealed the great capacity we have here in South Africa for innovation and adaptation in manufacturing.
In the space of just two years, through collaboration and out of necessity, we managed to build local production capability in ventilators, hand sanitisers, medical-grade face masks and gloves, vaccines and therapeutic drugs and anaesthetics.
Not only did we produce these goods to meet local needs, but also to meet the needs of other countries on the continent.
Local production is important because it encourages national pride in the goods, services and products made on our home soil.
It supports the growth of small businesses and the expansion of larger firms.
It creates employment and sustains livelihoods.
Local production supports our manufacturing sector.
It enables us to build much-needed infrastructure and improve our services.
As our country’s official localisation campaign, Proudly SA continues to fly our flag here and abroad.
We all feel a great sense of pride seeing the Made in South Africa label on products in other countries. It is even more encouraging to see them on shelves and in factories here at home.
Besides the vast array of products on supermarket shelves that are locally produced, South Africa is a producer of goods and services in agriculture and agro-processing, clothing, textiles, automotive, furniture, medical equipment and pharmaceuticals, to name but a few.
A growing local market enables producers to expand and to start exploring export opportunities in other markets.
We manufacture many of the vehicles that are exported to the rest of the world.
The BMW X3, just like the Ford Ranger and the Mercedes Benz C-Class, is manufactured and assembled here in South Africa.
The employment value chain in this sector is enormous – from the factory to dealerships, components and spare parts manufacturing, after sales service, mechanics and sales personnel.
The output of our creative industries is extensive.
Day by day, our artists are gaining new audiences around the world.
We see for example the runaway success of amapiano, and how it is part of the music scene in many parts of the world.
More and more locally produced films are being seen on screens across the globe and on the world’s largest streaming platforms.
Whether it’s in music, literature, art or fashion, South Africans are setting trends, locally and beyond our borders.
Our message at this annual Summit and Expo is that whether we are individuals or businesses, we can and should all choose to buy local.
By buying locally-produced goods we are supporting livelihoods, small business development and job creation.
We are supporting investment in research, new technology and innovation.
As long as we are producing quality local goods, we should also be buying them.
We have a number of aims for this Summit.
Firstly, to assist government departments and agencies to use procurement legislation and procedures to drive demand for local goods.
Secondly, to encourage corporate South Africa to expand its use of locally-made goods and services.
Thirdly, to educate consumers on labels of origin and on their role in contributing to job creation by making ‘Buy Local’ choices.
This year’s programme is versatile, dynamic and informative, with sessions on technical innovation, on the benefits of Special Economic Zones and workshops for entrepreneurs on intellectual property and other issues.
In the State of the Nation Address in February I made a point of mentioning that my suit and shoes were made by local producers.
I did so to draw attention to the quality of local goods and to the capability of local manufacturers, but also to encourage all South Africans to support the Proudly SA campaign.
It is not enough, however, to encourage people to buy locally.
We need to work together to create an environment that supports local companies.
That is why we have partnered with stakeholders in various industries to develop sector master plans that have already increased investment and production in several industries.
To create an environment more conducive to local production, we are reducing red tape and removing the barriers to entry for emerging companies.
We are undertaking far-reaching reforms in energy, telecommunications and in our ports and railways to improve the competitiveness of our products.
We all need to make a contribution to this effort – from government and state-owned companies, to business and labour, to producers and consumers – because we all benefit from this effort.
This Summit and Expo is a valuable opportunity to create greater awareness and appreciation about the benefits and transformative power of buying local.
I wish the Summit and Expo every success, for the good of the participants and the good of the country.
I thank you. The Presidency
SA needs a happy balance of imports and local goods
Sapref is an indicator of the challenges that make it more difficult and more expensive to run a business
The sudden closure of SA’s largest refinery is a big deal, but not necessarily for obvious reasons such as job losses.
Some jobs will be lost when the “spend freeze” and a “pause” of refinery operations commences at the end of March at Sapref, but of greater interest are the reasons that may have motivated the decision by BP and Shell to not invest more money in the business.
The refinery industry is just one of many local industries finding it more difficult to run a profitable business in SA.
Fast-rising production costs such as energy and labour, degraded infrastructure and unreliable electricity supply have all contributed to tightening margins for businesses and made certain industries less competitive.
To rectify this, several master plans have been devised, all with the overarching intent of promoting local production.
The clothing and textiles industry, for example, through its master plan, wants to see the share of retail sales of locally manufactured clothing and footwear increase from 44% to 65%. This plan has achieved some success and even President Cyril Ramaphosa was bragging in the state of the nation address about his locally made suit and shoes. The poultry industry master plan similarly aims to increase local production to substitute imports with a target of increasing output by about 10% by 2022/2023.
One of the measures used to promote local production in these industries is import duties and tariffs, which provide protection from importers that are able to land products in SA at cheaper prices than can be produced in this country. These trade protection instruments remain controversial, however, since they can lead to unintended consequences such as higher consumer prices.
SA produces petroleum from coal and gas, or from oil that it imports from Europe and the Middle East. According to 2019 figures, roughly a quarter of petroleum is imported as a finished product. For the other 75%, which is refined and processed in SA, imported crude accounts for about 65% of the feedstock and coal and gas for the rest. Sapref is responsible for 35% of the country’s refinery capacity but for about 25% of fuel supply.
In addition to certain of the constraints faced by all business in SA, as mentioned above, refineries are facing other changes in the market that will add to their cost of doing business. They will have to spend billions of rand to upgrade their facilities to comply with rules published by the government in 2021 that lowered the sulphur content allowed in the country’s diesel fuel. Refineries will also be liable to pay carbon taxes they will not be able to pass down to consumers, further eroding already thin margins. As energy economist Lungile Mashele said, what all of this means is that there no longer seems to be a business case to continue investing in the refining of crude oil in SA.
But if it is cheaper for SA to import clothes, chicken and petroleum, rather than to produce it locally, should we not just do so? Well, no, SA should aim for a happy balance that will offer security of supply at a reasonable price for consumers.
The risk that an over-reliance on imports creates — be it for clothes, chicken or petroleum — is to make SA more susceptible to what happens in the rest of the world. Greater import dependency means that an outbreak of bird flu in Brazil or the EU could result in shortages and rapid price inflation of chicken in local supermarkets, or conflict in Europe and the Middle East can cause temporary supply shortages at our petrol stations.
Master plans and trade protections serve a purpose, but they offer no solution to high input costs, unreliable electricity supply, policy uncertainty and the other challenges that are making it more difficult and more expensive to run a business in SA. BL
Top insights to increase your ROI through efficient workplace skills planning
Navigate the MICT SETA submissions and get inside info at Dynamic DNA workshop
Workplace Skills Planning, especially for those much-needed ICT skills, is filled with intricacies and acronyms that can make anyone’s head spin. However, if done correctly, the social, financial and cultural benefits of proper planning when diversifying and fortifying your workforce are undeniable.
Businesses can reduce their ICT learnership and skills development costs by up to 63% by ensuring a professional workplace skills plan and training report is submitted accurately and on time – before 30 April 2022 – to The Media, Information and Communication Technologies Sector Education and Training Authority (MICT SETA).
To help companies navigate their submissions Dynamic DNA is hosting a free WSP and Skills development workshop on 31 March 2022 presented by industry professionals who are highly experienced in skills development, ICT, MICT SETA, BBBEE, and transformation – companies can register via the web here.
Your ICT skills plan and training report, when done right, also creates opportunities for the introduction of your Employment Equity (EE) plan. These can be substantially beneficial for your company as it means that you can increase your Broad-Based Black Economic Empowerment (BBBEE) score. Ultimately, upskilling resilient, creative and adaptive ICT individuals with the potential to be key members in your workforce is essential to surviving and thriving in the modern business environment.
Prudence Mabitsela, founder and Managing Director of Dynamic DNA, a leading training and skills development company empowering Africa’s ICT generation, shares her top insights into how to prepare and submit your Workplace Skills Plan and Annual Training Report to the MICT SETA.
Perform a skills audit
There is a popular saying by Peter Drucker that says “You can’t manage what you can’t measure.”
The first step in the workplace planning process is to gather in-depth information via a detailed analysis of each employee to identify the skills gap in your workforce based on solid metrics.
Apart from gaining an extensive understanding of the roles in your company, this process naturally highlights which employees may not be optimally equipped for roles they are already in. By discovering these skills gaps you can make your budget go further by providing targeted training on these gaps that can be carried out swiftly to ensure your calibre of employees matches your projections and business plan.
Pay attention to the protocol
One of the most common challenges when it comes to WSP submissions is that the information gathered is not-relevant due to misunderstanding the submission process. Rendering it valueless in terms of ROI. For your submission to be valid, you must produce a Workplace Skills Plan (WSP) that is complete with Annual Training Reports (ATR), Pivotal Training Plans (PTP) and Pivotal Training Reports (PTR).
The purpose of submitting the company’s complete and accurate WSP and ATR is to enable the SETA to determine what amount the company should be “refunded” or paid back. If you fail to submit your reports, your company’s claim back may very well be suspended.
BBBEE levels are complex and without following the correct process to the letter it can be extremely tiring to improve your score. To begin the process, you need to be able to prove you as an employer are complying by having equitable representation on every level of your company, that reasonable steps are taken to upskill employees to move up, that steps were taken to implement the approved EE Plan, that there has been tangible progress made in eliminating barriers, and that reasonable steps are taken to appoint, promote and retain designated employees.
Collect evidence carefully
To earn points, all formal training requires proof such as attendance registers, certificates and invoices to back up the submission which the MICT SETA then needs to verify. It is extremely important to ensure that the data collected and the evidence provided is organised and complete, or your claims can be rejected and time wasted.
Submission of your Workplace Skills Plan and Annual Training Report is a strict requirement to enable your company to score points on a BBBEE scorecard and failure to comply will ultimately impact your BBBEE status. That is why all WSP submissions must include an EE plan of between 3-5 years. A well-drafted WSP not only helps a company to identify skills that are lacking in their workforce but also ensures that optimal funding is received from the SETA.
Selecting the right talent
WSP helps a company to identify skills that are lacking in their workforce. By addressing these training shortfalls internally they contribute to the professional development of their employees while investing today in the company’s future skills needs. Externally having a solid WSP helps inform HR on where you may need new employees to grow your company.
When upskilling individuals, there is always a risk that you may invest in someone who is perfect on paper and simply not the right personality. By following the correct planning protocol, you can improve employee retention. This is essential in businesses experiencing fast-paced scaling and expansion. At Dynamic DNA, our learners are chosen by our talent manager before they are put forward as candidates for our learnerships to ensure that only appropriate learners are sourced.
If you choose to train via learnerships not only are you making a long-term investment in youth and employees that have more years to grow with your company, but you also get additional points for the completion of youth training and absorption into your company. Not to mention giving back to the community and investing in the future of South Africa as a whole.
Get valuable knowledge
It is important that those responsible for Skills Development, B-BBEE Consultants, HR, Training, Learning and Development Managers, HR Consultants, and Transformation Specialists, attend training and share their expertise at industry events that can facilitate greater learning about the process of submissions.
The Dynamic DNA free interactive workshop explains and provides key advice on compiling your WSP/ATR submissions, along with key focus areas to align your skills development and transformation requirements. Workshops like these are a great opportunity to boost your knowledge and understand how to capitalise on levies and grants, as well as secure SETA funding and rebates. The list of speakers are well versed in their field and include Buhle Tafa, Director at People’s Development Network Enterprises; Prudence Mabitsela, Founder and Managing Director at DynamicDNA; Sivanesin Govender, Founder at DotConnectors; and Tinashe Banye, Portfolio Manager and a registered MICT SETA Assessor at DynamicDNA. Join this workshop here, please note only 2 delegates from 1 company are accommodated.
Make use of an External EE expert
Another challenge companies face is the time burden of research to find out if they are training the right person on the right skills for the ROI they are seeking. Investing in the wrong type of training can actively minimize your ROI. This is why we recommend getting specialised help from the experts in affirmative action and Employment Equity. They are equipped to provide you with insight on what skills are worth investing in and assist you to invest in the correct employees to earn the maximum amount of points for your investment. They are also trained to operate along the correct race and gender lines to ensure equal opportunities and fair treatment of all employees through the elimination of unfair discrimination.
When compiling and submitting a WSP you need to ensure that all pivotal training reports required for submission are within the financial year of the company to receive your points. There is also a difference between actual training – that is training that has already taken place – and planned training – that is training that is yet to take place – both of which should be included.
To bridge the wider societal digital divide, skills development and training need to be seen as a strategic priority of all companies, SME or otherwise, looking to scale. Employee retention, reducing costs, maximizing efficiencies and profit, anticipating challenges, avoiding disruptions, identifying critical roles, fill any shortage of talent to fill those roles are some of only a few benefits of performing this critical task. However, compiling all the necessary documents to go through the process smoothly can be time-consuming and tiring for a company. Luckily, there are experienced, passionate experts who are happy to assist you to improve and grow your company, thereby positively impacting your bottom line.
Date: 31 March 2022
Time: 09h00 – 12h30 Venue: Dynamic Tech House, Roof top 2 Venus St, Melrose Estate, Johannesburg, 2196.
This interactive workshop focuses on how to compile your WSP/ATR submissions, along with key focus areas to align your skills development and transformation requirements.
- Compile and execute your WSP/ATR effectively
- Dissecting the skills development cycle
- Know your levies and grants and where to capitalize
- Securing SETA funding and rebates
- Bolster BBBEE compliance mandates whilst leveraging your scarce skills gap
- Changes impacting stakeholders (SARS / Wages Act / BBBEE / SETA’s / QCTO, learning environment post covid )
- Learning interventions mapping to your skills element on scorecard
- Q&A with panel
To find out more contact Zanele Dlamini on firstname.lastname@example.org or call 011 759 5940
Published in Business, Economy, Finances, Banking and Insurance
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