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B-BBEE Amendment Bill – Submission to the dti – EconoBEE Newsletter – 07 February 2012

EconoBEE – Newsletter February 2012

EconoBEE - BEE Points = Business
Submission to the dti re B-BBEE Amendment Bill – Gazette 34845 dated 9th December 2011

EconoBEE is giving a qualified support to the proposed B-BBEE Amendment Bill. Keith Levenstein, CEO of EconoBEE said “We will support any initiative that genuinely seeks to promote transformation. Many of the clauses do indeed attempt to improve transformation by implementing B-BBEE better.

We like the fact that that a BEE Commission is to be appointed, to investigate breaches of the codes and to promote genuine Broad-based black economic empowerment. We like that fronting is to be criminalized, as it is the cause of much unhappiness. We like that all government departments are to be included in the B-BBEE requirements, just as much as private enterprise. Mostly we like that broad-based black economic empowerment is indeed broad-based, and if implemented properly will result in a higher economic growth rate, but also assist with poverty alleviation and a more equitable income distribution curve.

We give a qualified support only because the government, especially the dti has failed so far at its task of implementing B-BBEE. The dti has failed to expose fronting and to give sufficient interpretations. It has failed the country. To some extent the proposed act is the dti’s excuse for not doing its job properly. We don’t need a new act if the dti is going to fail to implement this one as well. Many of the clauses in the new act are already in the existing act, just slightly clarified which is not really necessary.

Read full submission…

Turnover below R5 million – find out how to get your BEE Exemption.


New BEE Targets – appoint your consultant before your level drops

The impact of the new BEE targets has been substantially understated by many industry experts. Large businesses can lose up to 13.41 points while QSE’s are slightly more affected at 18.67 points. Generally any loss of more than 10 points results in a two level drop. As many businesses already know they need to earn a higher level of compliance in 2012 because of additional government pressure and cannot risk dropping such a substantial amount of points.

It therefore becomes imperative to prepare a detailed calculation before going for verification to avoid any negative impacts.

Detailed analysis of the calculation

Generic

Points available
Old TargetNew Target% change
40% of new target
Maximum points loss
Employment Equity
22%3%33.33%1%1.19
543%60%28.33%24%2.78
463%75%16.00%30%1.89
468%80%15.00%32%1.87
Total7.73
Preferential Procurement
1250%70%28.57%3.43
310%15%33.33%1
39%12%25.00%0.75
26%8%25.00%0.5
Total5.68
Grand total potential loss
13.41

QSE

Points available
Old TargetNew Target% change
40% of new target
Maximum points loss
Employment Equity
1540%60%33.33%24%8.99
1060%70%14.286%28%4.65
Total13.64
Preferential Procurement
2540%50%20.00%5.00
Total5.00
Grand total potential loss18.64

The Employment Equity element has a threshold of 40% and thus the maximum points loss is at the point where on the new targets the threshold drops below that 40% threshold. This is particularly damaging for companies that are on the cusp of earning points for Employment Equity.

Appoint your consultant to calculate a preliminary BEE scorecard and assist you with strategies to improve your BEE scorecard – Contact EconoBEE on 011 483 1190 or info@econobee.co.za.

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EconoBEE Newsletter
07 February 2012

In this issue

  • Submission to the dti re B-BBEE Amendment Bill – Gazette 34845 dated 9th December 2011
  • New BEE Targets – appoint your consultant before your level drops

In other news

About EconoBEE

EconoBEE is an expert BEE consultancy. EconoBEE helps businesses Become BEE Compliant, prepare for verification, earn maximum BEE Points and ensure that they achieve the BEE Level they need to get more business.

Our services include BEE Management Systems, Training, EME Pack, Complete Managed Services; consulting and advisory and Procurement Solutions.

As leaders in the industry we are driven to help maintain and develop knowledge in the BEE industry.


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Contact Us

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Fax: 011 483 1195
Email: info@econobee.co.za
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Regards
Gavin and the EconoBEE Team

Executive summary of B-BBEE

Turnover below R5 million per annum – automatic BEE status

Turnover above R5 million per annum – you need a BEE Scorecard. Our workshops, scorecard tools, procurement manager or a complete managed services will be best for you.

Turnover below R5 milion

Tip:

Turnover below R5 million per annum – automatic BEE status.

10 Strategic Steps to B-BBEE!

We have prepared an easy to follow guide “B-BBEE in 5 Minutes” and “Crash Course to BEE Verification” which explains BEE in a simple step by step approach.

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