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Most companies fail to meet training levy deadline

By Reneé Grawitzky and Linda Ensor, in Business Day
8 March 2000

THOUSANDS of employers who are required to pay a training levy of 0,5% of their payrolls have failed to meet the deadline to register for the payments with the SA Revenue Service (SARS).

The SARS said yesterday there had been a poor response to the 220000 application forms distributed to employers who were supposed to have registered this week. They are required to register in terms of the Skills Development Act.

At the same time it has emerged that employers may reap the benefits and receive their grants back from sector education and training authorities only six months after the establishment of these authorities.

Industry sources said employers should be made aware of the possible delay and the reasons for this as the successful implementation of the act depended largely on efficient disbursement of grants during the first year.

These bodies are supposed to be up and running by next month when the training levies come into effect. However, some employers and unionists are concerned that the time frames laid down by the law are too tight.

Labour department chief director Adrienne Bird said during a briefing to the parliamentary portfolio committee on labour yesterday that everything was in place for the implementation of the act and 25 authorities covering each sector of the economy would be established this month.

Trainers said it had been acknowledged that it might take time for the bodies to carry out their main functions. Financial systems had to be in place to disburse monies back to employers. The authorities also had to be able to receive, evaluate and approve workplace skills plans before allocating grants, they said.

Employers will be required to pay an initial 0,5% of their total payroll for skills training from April 1 and 1% from the beginning of next year. The first levies should be paid to the SARS by May 7. Labour director-general Rams Ramashia said yesterday that his department would concentrate its efforts on policy implementation and improved service delivery this year.

Of the department's R748,3m budget for 2000/01 - a 5,2% increase over this year's expenditure - 20,7% would be spent on administration, 4,9% on health and safety, 2,9% on social insurance, 36,7% on employment and skills development services, 28,5% on labour relations, 4,5% on labour market policy and 2% on auxiliary items.

Ramashia noted that R285,6m of the department's budget would go to statutory bodies.