Bursaries and B-BBEE

Bursaries and B-BBEE


The Amended BEE Codes of Good Practice have companies gasping!! There are elements which are problematic and where compliance is difficult. People have questioned the rationale and many are floundering as they attempt to achieve compliance.

The introduction of Skills Development as a PRIORITY ELEMENT – where you have to achieve 40% of the target so as to avoid being discounted by one compliance level – and the increased spend requirement for this element, is also seen by many as problematic.

However, it’s important to note that the required spend can be utilised for the upskilling of employees or non-employees, whereas previously it was only spend on employees that would be considered.

While the required spend is high – 6% of Skills Development Leviable Amount for generic organisations, and 3% for Qualifying Small Enterprises, the good news is that this money can be spent on non-employees.

Bursaries to black South Africans have previously been counted under the Socio-Economic Development element of the B-BBEE scorecard however, this spend can now be included in Skills Development.

So how do you maximise the benefit of this spend?

We all know that employees are the lifeblood of organisations and fostering loyalty and retention should be a focus for all organisations. Bursaries for the black children of staff members can now be included as skills spend – giving the company points and staff a feeling of being appreciated!

In many organisations, there are scarce skills that are required – either for immediate inclusion in the workforce or as part of a succession plan. Bursaries could be offered to deserving applicants who would then form a pool of suitable recruits in the future. Allowing these individuals to work within the organization during their holidays will mean that they become familiar with processes and the culture and will make for an easy transition post their studies.

For any of these bursaries to be considered as Skills Development, they would need to be awarded to Black South Africans, and the claimable amount is the ex VAT amount. Further, the training that is undertaken will qualify only if it meets the following criteria:

  • Is offered by an accredited provider
  • Is independently assessed
  • Leads towards a degree, diploma or certificate

This means that secondary schools fees could be included.