Volume 10, No.3 - May 2001

A victory for all the people

Job Creation Fund - keeping you updated

By Josephilda Nhlapo-Hlope, COSATU Social Policy Co-coordinator

The total amount in the Job Creation Fund on 30 March 2001 was R 81,405,158.48.

The Development Bank of Southern Africa has finished the initial stage of the programme, which included:

• Putting the concept proposals into the database;
• Classifying them per province and category;
• Bringing them all to the same level in terms of clarity and detail.

3,292 applications have been captured, with projects worth R3.5 billion. If accepted and implemented, they will create 1,120,550 permanent and 15,611 temporary jobs.

All provinces are represented, with the Northern province, at 1,285, having the highest number. A lot of work was put into making sure that the projects are at the same level of preparedness. This included getting additional information from the applicants.

The next stage, which will took place in the second and third week of April, was the appraisal and approval stage. This was agonising, as many projects had to be turned down due to financial constraints. Evaluation forms were drafted to measure:

1. How well the project complies with JCT criteria;
2. Sustainability of the project as measured by its ownership;
3. The number of jobs to be created per amount requested
4. The multiplier effect as measured by potential forward and backward linkages of projects The following rejection and acceptance criteria will apply:

• Rural women's projects will have the most weight, though as EXCO decided, there will be no regional bias;
• Proposal that do not fall within the JCT criteria will not even be considered;
• Applicants requesting over R5 million will not to be considered at all, on the rationale that the applicants who feel they can handle such large amounts effectively can approach the bank or other funders like Intsika Trust. The highest priority will be given to projects of R1 million and below
• Projects that come from provincial governments will not be considered, because government has access to information and resources like poverty alleviation funds from the department of welfare and many more.

Work has begun to appraise the 21 projects that requested less than R100, 000. Disbursement for these will take place in May, after the trustees have made the final approval. This and subsequent disbursements will be made a huge media event. The regional project teams are to be activated to begin pre-project appraisal and provide support to the beneficiaries.

Contracts will be signed between beneficiaries and trustees, but will indicate that the bank is the implementing agency. An agreement contract form between the beneficiary and the JCT Trustees is still to be designed with the help of DBSA's and COSATU's lawyers. The form will be based on the bank's previous programmes.

There will be no system of appeal; the trustees' decision is final and no correspondence will be entered to. Requests for less than R50, 000 will be regarded as for grants.

Partnerships with other funders are being created, though because of the sensitivity of the negotiations their names cannot be mentioned yet, except for the Skills Development Division of the Department of Labour.

According to the data now available, on average it will take about R3, 000 to create one permanent job. However this figure will fall because when sifting is done, only those projects that promise to create more jobs for less money (highly labour intensive) will funded.