Fin24

Gordhan unveils jobs fund details

2011-06-07 14:28

Cape Town - Finance Minister Pravin Gordhan declared the government’s new Jobs Fund open for business on Tuesday, saying a “new boldness and energy” were needed in the job creation process.

He told reporters at parliament the R9bn fund, first announced in February this year, would be managed by the Development Bank of SA (DBSA).

“In South Africa, more so than any other country in the world, we require a new boldness and a new energy to be infused into the job creation process,” Gordhan said.

“More importantly, we need to be able to demonstrate we can deliver on policy pronouncements, and focus more on delivery than on talk about jobs.”

He described government’s latest attempt to stimulate job creation as a “challenge” fund.

“Meaning we want a competitive environment in which as many government entities, private sector entities and non-governmental entities as possible come forward with ideas that will require co-funding in one form or another.”

The fund would provide grants, not loans. It has been allocated R2bn for the current financial year.

“The idea of the fund is it will not be giving loans, it will be giving grants on a co-funding basis,” he said.

According to a document distributed at the briefing, the financing offered by the Jobs Fund will vary in funding ratio and contribution according to the type of applicant.

“To ensure real ownership, there will be a cost and risk sharing by applicants, with a matched funding ratio of 1:1 for private sector applicants.

“However, for non-private sector applicants there is a reduced own contribution, given that such applicants are likely to have less resources to contribute.... In some cases, a minimum contribution may apply,” it states.

Gordhan said one of the fund’s focus areas would be unemployed youths.

“The whole idea would be that through engagement at a grassroots level, we can excite young people in particular but other members of the communities as well to become participants in this process... to increase access to institutions (and) to funding.”

The fund was about providing people “with the leverage they require to become connected to... the formal economy“, he said.

DBSA deputy chairperson Frans Baleni, who will chair the Job Fund’s investment committee, said at the same briefing applications to the fund were welcome “from today".

Those wishing to apply could obtain details on the website www.jobsfund.org.za or call the toll-free number 086-100-3272.

"We recognise that the success of this Jobs Fund depends on strong cooperation between the public sector, private sector and non-governmental organisations," he said.

Bold venture

His deputy chair on the investment committee, Business Trust chief executive Brian Whittaker, said the fund’s establishment was an acknowledgement of the scale of South Africa’s unemployment problem.

“(It’s) a bold new venture that acknowledges we’ve got a problem; very high numbers of especially young people out of work is something that the country can’t live with... There’s an opportunity here to do something innovative,” he said.

An estimated 42% of South Africans between the ages of 18 and 29 are unemployed.

Opening debate on his department’s budget in the National Assembly later on Tuesday, Gordhan told MPs that youth unemployment was a serious challenge.

“We face a serious unemployment challenge, particularly among our young people,” he said.

Speaking earlier at the briefing, the DBSA’s Paul Kibuuka, who heads the bank’s development fund, said the Jobs Fund aimed to create “150 000 jobs over a period of three years“.

This would include “short time” jobs of one-year duration, and those longer than one year. The Jobs Fund was looking at a range of 1 000 to 2 000 projects.

According to the briefing document, applications for funding can be lodged “as of today (June 7)“. It said the closing date for the first round of applications is July 31 this year.

On the length of time it will take to process applications, the document said a large portion of the process would be done electronically.

“Once an application is received, it will be screened against the eligibility criteria, the competitive impact criteria, and then submitted for decision by the investment committee.”

On the type of projects to be funded, it said this will include, among others, light manufacturing, critical transport and communication links, investment in product development, local procurement, marketing support, equipment upgrading or enterprise franchising.

Another focus area is support for work-seekers, including help with job searches, enhancement of training facilities and support for career guidance and placement services.



Comments
  • Goose - 2011-06-07 14:58

    Excuse me for pouring water on your party, but how can the ANC government on one hand completely kill the business environment, and on the other spend billions on promoting business? Mark my words, this 9 Billion will simply go down a black hole and precious little in terms of return-on-investment will remain. I am not being negative, just looking at the facts as they are and this is the only conclusion I always come back to.

      Lunguza - 2011-06-07 15:31

      You are being negative, at least tell us how is the government killing business.You should be proposing something. I personally welcome this initiative and will most probably apply as I'm willing to make this country work.

      Refilwemu - 2011-06-07 15:55

      you are retarded please get help in Australia

      WhiteEagle - 2011-06-07 16:01

      @Lunguza,it's not being negative just being a realist because in one hand the govermment imposes all these draconian laws which discorage business to invest and employ people that can't be fired if they not perform. Then again the gravytrain crowd are probably the ones that will line up for these funds as they have done to all other initiatives.

  • MoneyEQ - 2011-06-07 14:59

    I tried the web page link asdetailed and the site does not exist - why does this not surprise me. Can you imagine the amount of fraud and croniasm that will take place here - my guess is that the numbers will have to be smudged in order to reach the objective while a few fat cats will coin it

      william.botha - 2011-06-07 15:26

      Yep, broken link, like many other broke/n entities. I as a manufacturer have no chance of being involved, these funds will just disappear into oblivion.

      Tomas - 2011-06-07 15:52

      I think more its a question of poor reporting by News24. They have become notorious for errors in their articles (like spelling mistakes!).

      Hartmut - 2011-06-07 16:02

      Tried the website too. Same result. As an accountant I just wanted to be updated to be able to help my clients.

  • Robin - 2011-06-07 15:27

    We need 10 times as many jobs - just to keep pace with school leavers - and we need a growth rate of over 8%. This is poverty entrenchment canavit

  • Bosj - 2011-06-07 15:27

    Mr Minister, I tried to access the web site, but it does not exist. I just phone the tollfree number. The correct website is www.jobsfund.org.za

      Judith - 2011-06-07 16:07

      Thanks for your assistance!

  • CNA-LOL-BS - 2011-06-07 15:33

    My questions are: 1. Jobs for whom - Jobs for all or BBBEEE, BEE, AA? 2. Only 150 000 jobs in 3 years and there are currenltly 6 million unemployed youth (according to Mr Vavi) that does not include the other 25 million unemployed people in this country? 3. How is this going to make an impact on the UNEMPLOYMENT RATE / STATS in the country?

  • safa_Rich - 2011-06-07 15:36

    "An estimated 42% of South Africans between the ages of 18 and 29 are unemployed". This wonderful statistic is a clear indication that the ANCYL is a pointless entity of the ANC. The youth in this country have no direction, clearly no desire to work and are the result of the ruling parties youth league lacking the leadership to inspire better qualities in the youth. The youth in this country need a leader who will inspire them to go out and through hard work and perseverance, make this country a better place. Then can the words "economic freedom" make any sense. Are the ANC just blind or just so ignorant that they feel these statistics do not reflect the state of affairs in the minds of the youth of this land, not to mention to failure of the entities put in place to prevent it. Is throwing money at it really going to make the problem going to go away.....I fail to see how you fix something so fundamentally wrong by wasting tax payers money (which they work pretty damn hard for) on these pointless ventures.

  • pure.black - 2011-06-07 15:43

    The website link supplied does not exist? Is this just another incompetence by news24 or is Pravin talking bull****

  • Sharon - 2011-06-07 15:46

    Goose you are smack on the button with your comment. To businesses it's more hidden taxes in various forms, bargaining councils that do nothing for members other than steal their money, etc etc. My next business venture will be in Perth...tired of leopard crawling uphill in this environment.

      Sally - 2011-06-07 20:36

      Good riddance and welcome to Recession Aus(minus 2% GDP) South Africa 4,8% GDP,STOCK MARKET collapsing(R200 Billion lost last week-see SMH).Join the whingers in Aus.

  • Julius - 2011-06-07 15:49

    The ANC version of a job is : you get the money. They do not realize that a job is primarily there to do something or make something

  • Somdyi Dyiva - 2011-06-07 15:57

    When govt doesn't do anything, people complain, when it tries to do something, people again complain. Some even going as far as claiming they have the facts when this project has not even started. When government doesn't bring in FDI people complain, when foreign companies show interest in S.A that will help create jobs, people want to protect the environment. When govt tries to protect local people from exploitation by foreign companies, people complain that it will discourage FDI. When blue chip companies confess that they have exploited consumers through uncompetitive behaviour for the past 100 yrs, people blame government, instead of toy-toying against the companies, oops I forgot they have work to do, or better, they have whinging to do on the internet. When an estate agent chows trust money, people complain for 1hr and then immediately shift blame to the Estate Agency Board, because it is black managed, and complain for 6 months.

  • Johan - 2011-06-07 15:59

    Affirmative Action "South Africa is the only country in the world where affirmative action is in the favour of the majority who has complete political control. The fact that the political majority requires affirmative action to protect them against a 9% minority group is testament to a complete failure on their part to build their own wealth making structures, such that their only solution is to take it from others." London Times

      Rajty - 2011-06-07 17:59

      And what does the rst of the article say Johan- perhaps we should accept that 9% of the population ousted the rest- the wealth making structures that the 9% have were built on the backs of all the people-so don't be naive. if you still think BEE is an attack on whites you should go for counselling- it goes much further than your little ego suggests. And stop quoting out of context.

      jaye - 2011-06-09 07:52

      Johan that is not entirely true. See Malaysia, Malays are in the majority (60%) and the Chinese in minority (25%) other percentage is made up of Indian and foreigners. Yet there is a policy in place to benefit the Malays and not the Chinese. All businesses need majority Malay ownership in order to get or apply for any tenders. I know this because I am a white South African living in Kuala Lumpur

  • lulama - 2011-06-07 16:15

    The correct website is http://www.jobsfund.org.za/. Don't be so negative guys, lets give this fund and all other initiatives a chance. Yes there will be corruption, but lets try to make it work

  • Geoff - 2011-06-07 16:21

    Oh Boy! Is this web address an error from the Ministers side or was it reproduced incorrectly? Either way, what is the correct web address?

  • Louis - 2011-06-07 16:22

    Stop, stop this law that if you are on ITC you cant get a job the ANC is killing jobs because of that law thousands of skilled workers are out of a job the government is enforcing unemployment

  • gawie.botha - 2011-06-07 18:33

    To make a long story short....................If this plan sucseed Mr. Gordhan,u wil receive the following: The Nobel , an Oscar and.. "give that man a bells"! award!

  • gawie.botha - 2011-06-07 18:43

    To make a long story short....................If this plan sucseed Mr. Gordhan,u wil receive the following: The Nobel , an Oscar and.. "give that man a bells"! award!

  • BernieK - 2011-06-07 23:44

    Ok then. Let us see how this pans out. I hope that this plan succeeds. We need however other plans too. Make it easier for business to employ. It is very difficult to employ now. Very difficult. So I am sorry guys. We need to be bolder, much bolder.

  • Pietpetoors - 2011-06-08 07:29

    No thanks, you can even pay 80% of the worker's salary I still don't want them. Because of the labour laws, once you appointed him it is very difficult to get rid of him again

  • Fikile - 2011-06-08 10:05

    Drop the interest rate by 2%, and manufacturing will 500000 new jobs. TAX raw material exports.

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