Fin24

Zuma: New jobs fund, tax breaks

2011-02-10 19:07

Johannesburg - President Jacob Zuma on Thursday announced the establishment of a jobs fund of R9bn over the next three years to finance new job-creation initiatives.

In addition, the Industrial Development Corporation (IDC) had set aside R10bn over the next five years for investment in such economic activities with a high job creation potential, he told parliament in his third state of the nation address.

"It is also my pleasure Honourable Members, to announce R20bn in tax allowances or tax breaks to promote investments, expansions and upgrades in the manufacturing sector," Zuma said.

For a project to qualify, the minimum investment should be R200m for new projects, and R30m for expansion and upgrades.

Merger may save money

The programme would provide an allowance of up to R900m in tax deductible allowances for new investors and R550m for upgrades and expansions.

Zuma said the small business sector was a critical component of the job creation drive.

"We will continue to provide financial and non-financial support to small, medium, and micro enterprises (SMMEs), small scale agriculture as well as cooperatives.

"We need to cut administrative costs, avoid duplication and direct more resources to small business," he said.

Therefore, consideration was being given to merging the three agencies Khula, the SA Micro-Finance Apex Fund and the IDC's small business funding into a single unit.

The programmes of state owned enterprises and development finance institutions should also be more strongly aligned to the job creation agenda.

Research had indicated that jobs could be created in six priority areas.

These were infrastructure development, agriculture, mining and beneficiation, manufacturing, the green economy and tourism.

Turning to mining, Zuma said the government would make it a priority this year to adopt a beneficiation strategy "so that we can start reaping the full benefits of our commodities".

Other priorities included giving a third of the 1.2 million households living in informal settlements security of tenure within the next three years.

"By the year, 2014, 400 000 of the said households should have security of tenure and access to basic services."

Zuma acknowledged that service delivery needed to be speeded up and, in a first, cited angry complaints citizens had posted on government's Facebook page.


Comments
  • Dan - 2011-02-10 19:41

    ....and apart from a jobs fund (ripened for corruption and mismanagement) and a tax incentive for companies who are aleady taxed/BEE/AA to death what is the plan honourable president...

  • Seen it all. - 2011-02-10 19:57

    R200M for a new project ?? There arent going be many companies able to show due diligence for that amount. R20M projects are more viable, especially for smaller companies.

  • Kate - 2011-02-10 19:59

    Please Mr. JZ we pay exhorbitant municipal fees, and do not have any basic service for it.( Our own borehole,own rubble removal,grading our own roads, pay Eskom direct) The informal settlements has more services than those who actually pay their hard earned money, with no return.I agree giving the informal settlements services, but please give it to those who actually pays as well.

  • Inky - 2011-02-10 20:12

    50 000 of said households could have had security of tenure and access to basic services last month already if they had got the R100 million the NYDA wasted on a party

  • Investor - 2011-02-10 20:27

    Well done Pres Zuma, great inspirational speech, you are our hero !!! Now lets create growth and jobs !!!!

  • MICHAEL SIBIYA - 2011-02-10 20:29

    I think the President did all he could and it shows that many ministers were involved in this so i cant complain hes the 1st citizen after all

  • Madelane - 2011-02-10 20:32

    That should read...Job fund for cronies....they also have a high lifestyle to maintain you see......quite how throwing taxpayers money around creates work I am not sure especially when tthere is talk of investment being needed on the one hand and the threat of nationalisation on the other....rather typical of the muddled non thinking ANC government.

  • VicJ - 2011-02-10 21:05

    More yarayara less chinkchink. Mining-so we (who?)can start reaping the full benefits of our commodities. Malema been talking to Zuma?

  • Realist - 2011-02-10 21:10

    Did His Excellency, the Right Honourable Douche have anything to say about crime, corruption etc?

  • GrannyC - 2011-02-10 21:38

    Blah-di-blah-blah and so he waffles on. R9bn job fund??? I don't think so, just another way to get money from us taxpayers to line your own pocket. I wish the masses who vote for the ANC would wake up and realise that the ANC have done sweet buggerall for them since they came into power. I suggest they think about voting DA, could things get any worse?? I don't think so.

  • a.petersen - 2011-02-10 21:43

    one of the best speeches in many years.Zuma is bold.goodluck.

  • OomHennie - 2011-02-10 21:53

    Like somany times before, Mr President: 1. You do not tell us your plan (if there is a plan?) 2. Taxpayers to pay for your plan. Now what is new in this speech ? Nothing !!

  • Tax Payer - 2011-02-10 21:56

    Yes Dan. More corruption that is already rife. The tax payer will now be taxed to death.

  • Jean - 2011-02-10 22:01

    blah! blah! blah! more money to friends, relatives and anc cadres. just another mechanism to keep the gravy train going and Malema in stock of Blue Label whisky.

  • GDC - 2011-02-10 22:04

    Money for the agriculture section. Does this mean dairy farmers and small and medium dairy product production. Mr President as much as any assistance is welcomed and treasured why did the Government and DTI allow this industry to go into such collosal demise.Sacrificing so many opportunities and jobs and more. Yes blame DAFF / DTI/ and DOH for allowing NON dairy product suppliers and manufactures..local and international.. and the Major dairies to basically kill off the dairy industry. Now it has to rebuilt. So sad Mr President and what are you going to do about it or stop it from happening again. Thank you

  • UncleSpud - 2011-02-10 22:46

    Honourable Members, Hah!!!!! At least two thirds of of the ANC parliement have been accused and wriggled out of just about every corrupt, immoral act you could imagine. Honourable Members?? I don't think so.

  • BernieK - 2011-02-10 22:59

    As expected, a rather flowery delivery and no real substance. I am not surprised and not impressed. Why did he actually make this speech?

  • OptimisticPessimist - 2011-02-11 01:36

    Third World fun fun fun!!! Build more clinics right? Why not get the people jobs so they can PAY for a medical scheme (like I HAVE TO...), giving them PROPER PRIVATE healthcare, and having to pay less slacking Gov Employees........... 18% of Dept of Health employees ACTUALLY CARE about the PATIENT!!! The rest of the time they just worry about April, 'cos then its INCREASE TIME! Fun Fun Fun PS: I work at a Hospital, these are FACTS (except the 18%, that was a rough guestimate, could be less)

  • paddy - 2011-02-11 07:43

    what about pensioners on a fixed income we have saved for years and when ever there is tax relief for those who are in debt we suffer by losing interest its not fair

  • AriesSpirit - 2011-02-11 08:11

    But don't you just love the fawning way Gareth Cliff is going on about this empty speech on his morning show?

  • Doped - 2011-02-11 08:11

    CRISES....WHAT CRISES....??? First things first, ban the trade unions and stick to basic employment conditions and SA will prosper to be a major industrial world player of note.

  • Wayne - 2011-02-11 08:18

    If a person cannot afford a home, they cannot afford to maintain one either. If people can have kids they can obviously afford to buy a home as that is obviously in their plans. What are tax payers paying for houses for non-tax payers with kids? If you want to increase employment, boot out all those foreigners that do not have a scarce skill and offer sterilisation to the destitute so we can stop breeding millions of poor, homeless, uneducated, unemployed, sickly people.

  • neil - 2011-02-11 08:30

    GOV FACEBOOK...................MORE LIKE GOVE JUNGLEBOOK !

  • kgalalelo - 2011-02-11 09:07

    as an environmentalist i understand why government wud want to reap more benefits frm mining and i do support it. people have to be aware of risk this mining has brought to out country and its time we get more money out of it even if it means getting all the money it males to cover for all the disasters that we anticipate....i mean right now its acidwater drainage, sinkholes and now i can imagine wats nxt to come is it going to be earthquakes toppling the whole infrastracture we have come to pay for. i mean most of jozi is sitting on elevated earth with ald wornout pillars dating donkeys years. lets be realistic we need as much money as much as we can get out of mining.

  • Richie - 2011-02-11 09:15

    Firstly, permanent lasting jobs cannot be created from thin-air by throwing state funds at it!!! The ONLY way true jobs can be created is by growing the economy. This is a fact, that clearly evades the ANC government. America under FDR Roosevelt understood this and created “semi-permanent” jobs to carry America through after the doldrums of the depression and war. This type of solution they knew was always temporary and eventually drains a economy. What these funds (9 billion) should be used for is EDUCATION. Not only tertiary as a growing economy developing nations economy needs basic skills first. Trade schools, basic IT, tourism, etc. We all cant be doctors and engineers. I had 200 pupils in my university class in my first year and only 16 of us finished our degrees. We lost at least half the students by the first year and another third by the second, only 30 got their diplomas and only sixteen of us got our degrees of which there was 2 black students who scraped by. This means that 170 of students that started the courses, wasted their bursaries and tax money it costs to educate them. The point of my explanation is we are going about this education thing in totally the wrong way. Students have to be screened properly otherwise we are just throwing money into the water. At this stage we are forced to bring down the standards of the tertiary institutions. The Cape Peninsula University of Technology’s quantity surveying department who had a long history of producing some of the finest quantity surveyors in the country who even blew the big universities students out of the water, has recently lost their accreditation and will possible never recover thanks to BEE appointments and the total drop in standards. This I fear is happening all over our institutions. The only worthwhile points Zuma made in his speech were education policies that he stole from the DA and Helen. How very sad that we are missing the opportunity to be led by this amazing woman and struggle hero? My 2c

  • DeonL@paddy - 2011-02-11 11:30

    Paddy I feel for u. It might be best to rather get a Financial advisor to spread your money in shares, property and the bank. Most people nowadays have least of theire capital in banks due to lowest interest ever.

  • SF - 2011-02-11 21:59

    Richie, I disagree, only small and medium enterprises can grow employment. The logic is as follows(alla Japan model). If big business invests in any new growth plans, the likelyhood is that they mechanise entirely because they get so much more money and don't want unions to stuff it all up, so they only create a few highly skilled jobs, although well paid. If however, medium enterprise expands/deiversifies, the entrepreneur will be more cost conscious, therefore will be more creative at maximising the borrowed investment, i.e less mechanised, and will most likely create far more unskilled as well as some skilled jobs,so he/she can compete with the big boys and kick their arses. What defies the logic, is that a medium enterprise T/O is rated between R5m to R35m, so setting a minimum of R30m investment will automatically hurdle the medium enterprise into a BIG one, therefore subject to every law, and associated cost thereof, that must be adhered to,huge growth pains etc, but there are many other ways to skin a cat, like splitting your business into smaller entities. I think this route is the way to go. But please, can the DTI catch a speed wobble so the money is dispensed when it's actually needed, at the amounts agreed to.

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