Job Stimulus Fund

covid-19 relief fund

The Jobs Stimulus fund, in its current form, provides support to distressed businesses operating in key sectors as outlined in the PEDS, to ensure the retention of employment by affected businesses. The fund provides a once off incentive of R10 000.00 per job to distressed businesses, with a minimum requirement being the retention of 10 jobs.

 

In an attempt to respond to the current pandemic (COVID-19), the jobs stimulus fund will provide special consideration to businesses that are negatively affected (directly or indirectly) by the Coronavirus, as outlined below, with effect from the 01 April 2020 until the 31 March 2021.

Qualifying Criteria - Special Consideration for COVID-19 impacted businesses.

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The Jobs Stimulus Fund Criteria will apply to businesses with an annual turnover of above R 20 million, where businesses are incentivized at R 10 000.00 per job retained/saved. This category of businesses, dependent on sector, has potential to create sustainable employment above a level of 10 jobs (R 100 000.00 incentive) up to 100 jobs (R 1 million incentive) minimum, in terms of the National Small Business Act.

 

Further, the contribution of relatively large businesses in terms of employment creation and retention as supporting to the government sector cannot be undermined, which justifies the proposed support in terms of current jobs fund policy. 

  1. Companies with 100% South African shareholders

  2. Companies with a minimum retention of 5 jobs

  3. Employees must be 70% South African

  4. Employees must be permanent or with a 2-year fixed term contract

  5. Tax and legislatively compliant entities with SARS and the UIF

For companies applying for distress and the retention of jobs at risk: Two years of signed financial statements by a registered Accountant, creditor accounts and/or management accounts that the company is “distressed” must be provided.

All businesses with a turnover less than R 20 million, with minimum retention of 5 jobs will be entitled to an additional incentive (over and above the once off R 10 000 per job) as follows;

  • The above is a once off incentive per category to cater for three months working capital specific for rental, salaries and other key operational expenditure (Detailed cost breakdown to be submitted) – subject to detailed motivation for additional working capital support over the three months period.

  • Budget allocation will also have an impact in the level of working capital provided, where the above incentive thresholds may be reviewed at the discretion of the ECDC per business case.

Businesses operating in the following specifically targeted sectors will be prioritised for participation in the Programme and the Fund, namely:

  1. The Agro-processing and benefication in the agri-business sector, and the Green economy

  2. Tourism and Hospitality

  3. The manufacturing sector

  4. Capital goods producers

  5. Construction

Companies in the Services Sector may be considered to participate in the programme if: The economic and social impact due to prevalent job losses is significant.

Additional Financial Information Required

Including, but not limited to, the following information:

  • Two years of financial statements and management accounts

  • Distress Project Execution Plan - 12 months Cash Flow Projections including, estimations for incentive;

  • Key financial indicators for the current and past 2 years namely revenue, net profit, labour expenses (wage bill), net assets, net current assets, current & total liabilities

  • operation costs, etc. (validated by means of audited/signed financials and/or management accounts)

  • Date of last audit opinion and type of opinion (where applicable)

  • List of creditors, inclusive of debt and relevant arrangements for “distressed” companies

A detailed motivation regarding the impact the Jobs Fund is likely to have on the sustainability of the entity and the reducing potential for jobs losses within the “distressed” company. Inclusive of additional non-financial support that would be of value. Additionally, details of what measures have already been effected to minimize operational and job losses.

 

For application forms click  here

For more information contact 

Buseka Ningi

Telephone: 043 704 5789

Email: bningi@ecdc.co.za