It’s Spring BEE Motivated – EconoBEE Newsletter 2 September 2009

EconoBEE - BEE Points = Business

EconoBEE Newsletter – September 2009

02 September 2009

It’s Spring – BEE Motivated

Spring has finally arrived, the weather is warmer (or at least it is in Johannesburg) the birds are flying home and the BEE’s are Buzzing. This really is the time to BEE Motivated.

In the last few months some very positive changes have started coming into play which greatly enhances the business aspects of broad based BEE.

  • The BEE verification agencies were accredited.
  • Government procurement has come leaps and bounds to be more in-line with the BEE scorecard – in effect completing the true broad based BEE circle of empowerment.
  • Tax benefits have been introduced for social development spend.

Our motivation is to encourage true empowerment, aimed at helping the people who need it most and condemning enrichment. We have been keeping ourselves ahead of the pack by introducing unique applications, interesting seminars and the most fantastic BEE conferences.

Some of our upcoming projects are:

SED BEE Spend Tax deductible

The positives for B-BBEE compliance just keep coming. Finally the different ministries are communicating the same message – support broad based BEE.

Recently SARS issued a Binding Class Ruling stating that “Expenditure incurred in respect of the CSI programmes for purposes of earning BEE scorecard points will be deductible under section 11(a) read with section 23(g).“.

This is very exciting as it sets a precedence that any spend initiated in order to earn BBBEE points will be regarded as a tax deduction. Previously companies could only claim an expense as a tax deduction if that expense was part of the activities of the business. CSI, in some cases was not regarded as part and parcel of doing business and expenses could not always be claimed as a tax deduction. The SARS ruling recognises that a BEE scorecard is an integral part of doing business and therefore spend on, in the instance above, bursaries, are regarded as going towards improving the scorecard and can be regarded as a tax deduction. (Please check specific aspects with your tax advisor if you have queries)

Sustainability – Public-private partnerships

Last week’s newsletter mentioned the 2002 World Summit on Sustainable Development, held in Johannesburg, and its reaffirmation of the Agenda 21 implementation plan. Agenda 21 was targeted primarily at the public sector: national civil service and planning authorities, but as the newsletter suggested, “think globally, act locally” is a maxim that should be embraced by all, including citizens, and the non-governmental and private sectors.  This was explicitly recognised in Johannesburg with endorsement of public-private partnerships, or “type 2 outcomes” in UN-speak.

Over 220 type 2 outcomes were agreed in Johannesburg for implementation around the world, and perhaps more importantly paved the way for public-private partnerships, which are 

Read More…

Disabled People – Great Way to “do good” and Increase BEE Points

Disabled people unfortunately have been more discriminated against than other race/gender groups. It is a little known fact that the BEE Codes of Good Practice awards companies even more points for disabled people. Some of the areas on the scorecard include Ownership for designated groups, Employment Equity, Skills Development and  Socio-economic Development. We have formed a partnership with a very good organisation, The Association for the Physically Disabled who have a division Barrier Breakersdownload some info to earn yourself a great deal more BEE points and do true empowerment.

EconoBEE Clients 3 – Verification Agencies 0

In the past three weeks we have had to take up three issues on behalf of our clients with their verification agencies. In all three cases, the verification agencies agreed with our interpretations and calculations. In the first case the client went up from level 6 to level 5. In the second the client went from level 4 to level 3, and the last case from level 8 to level 6.

On average the score went up by 8 points. In one of those instances we pointed out an error to the verification agency where they had allocated two more points than they should have, but under calculated 15 points on other elements, proving we are objective as well as competent!

If we had not been involved with our clients and examined their preliminary scorecard in great detail, and known exactly what score they should have achieved, the client would simply have accepted the scorecard handed to them. In some cases the client did complain, but were almost ignored until we raised the issue via the correct channels and methodology.

In one instance, during the verification, the analyst gave a calculation and an interpretation. We disagreed, and the analyst said that is how it is done. We asked, as per clause 16.2 of the verification manual for the issue to be documented and we asked the agency to explain in terms of the relevant clause in the codes of good practice. This was done and the agency came back within 2 hours to confirm their agreement with us. In another instance we were forced to lodge a formal appeal. We asked the agency to supply us with their appeal procedure, and we spent at least 2 days drafting the appeal, giving suitable proof, evidence and precedents. The agency followed the procedure and came back to us agreeing with our interpretation, adding 7 points to our clients’ scorecard.

The conclusion: If we had not been involved our clients would be 1 to 2 levels lower than they deserved.

Draft Preferential Procurement Regulations 2009

Battling to make head or tail of what this means to your business?

We can clarify this for you!

The Draft Preferential Procurement Regulations affects you only if you currently do business with government or want to do business with government. In the past government tenders (including councils, provinces, govt departments etc) had not used BEE criteria in evaluating your tender proposal. They used to only take into account your black ownership as one of the criteria in deciding whether to award that tender to you. The new draft regulations state that once finalized government must take into account your BEE score, rather than only your black ownership. In addition if you are non-compliant you are not disqualified from the tender. This is a huge step forward by government in following BEE and opens doors for your business and all other businesses that have a BEE scorecard to do business with government.

If you need more information, join us in October for a BEE Procurement and Enterprise Development Conference.

Transport BEE Charter – Download Now

The DTI has announced that the transport sector charter has been gazetted. Download the gazetted BEE charter, visit

Is BEE procurement a pain? Sort it out quick and easy – click here.

Not sure how to get a BEE Scorecard, click here to see a demonstration of how best to produce your own BEE scorecard.

In this issue

  • It’s Spring – BEE Motivated
  • SED BEE Spend Tax deductible
  • Sustainability – Public-private partnerships
  • Disabled People – Great Way to “do good” and Increase BEE Points
  • EconoBEE Clients 3 – Verification Agencies 0
  • Draft Preferential Procurement Regulations 2009
  • Transport BEE Charter

In other news

About EconoBEE

EconoBEE is a BEE consultancy who has developed extremely effective tools to measure and implement Broad Based Black Economic Empowerment. Our services focus on the business side of BEE.  Our services include EconoBEE Scorecard, BEE Scorecard Workshops, EME Pack, Document PackEconoLog and the 10 Step Process to BEE Compliance.

Our company supports various organisations and drives the BEE Expert Group to help maintain and develop knowledge in the BEE industry.

Already have a BEE Certificate?

Please send it to us and we will include it in our BEE Procured database.

Contact Us

Tel: 0861 11 3094 or 011 483 1190
Fax: 011 483 1195

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Mabuya Glass Whiteboards

Support true enterprise development – contact Mabuya Glass for your glass white board – easy to install and use, and it looks really smart. Msizi will have stock by the end of the week. Only R299 for an aluminium framed board 80cm by 60cm. Other sizes on application (order form). Call Thuli on 011 483 1190 for information.

BEE Points = Business

That’s it for the time being.
Keith and the EconoBEE Team

Executive summary of B-BBEE

Turnover below R5 million per annum – automatic BEE status

Turnover above R5 million per annum – BBBEE Scorecard Compliance

EconoBEE – Knowledge Transfer

BEE Procurement and Enterprise Development Conference – 1 Oct JHB, 8 Oct CPT and 15 Oct DBN

Sustainable Development

Announcing our – Two day practical Sustainable Development conference. Details to follow. ProfileBecome BEE CompliantEconoBEE ServicesBEE ResourcesContact

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