By Diane Silcock
COMPANIES with an annual payroll of over R500 000, religiously pay over to the South African Revenue Services (SARS), their monthly skills development levy (SDL). But are employers taking advantage of the government funding available for employee training and are they familiar with the process of applying for grants?
What is the purpose of the SDL and how are the levies distributed?
As stated by SARS, ‘SDL is a levy imposed to encourage learning and development in South Africa and is determined by an employer’s salary bill. The funds are to be used to develop and improve skills of employees’.
The levies are distributed via the government’s Sector Education and Training Authority (SETA). There are 21 SETA’s representing all sectors of industry.
What companies need to know before applying for government funding for training
Cape Business News spoke to Schalk Kotzé, skills development facilitator for the National Employers’ Association of South Africa (NEASA), an organisation that assists companies to maximise the benefits of skills development. He agrees that there is a lack of knowledge around the subject.
“Every SETA has specific Standard Industrial Classification (SIC) Codes,” he says, “so it’s important to ensure that employers register with SARS for SDL under the correct codes so that they are allocated the SETA appropriate to their industry. Each SETA promotes skills and development in their industry sector. If a company is outside of that particular SETA’s scope, it’ll be very difficult for them to acquire additional funding.”
Kotzé says that to apply for funding, companies first need to ensure that their skills levies are up-to-date and that they have a valid SDL number as registered with SARS. But before they can submit their training reports to SETA, and claim back mandatory grants, they need to have implemented training.
“If companies do not implement their training programmes, they won’t get back their mandatory grants,” Kotzé stresses.
NEASA deals with all SETA’s and extensively with merSETA, the Manufacturing, Engineering, and related services SETA, where there is a big demand for training, and therefore a sector where much of their work takes place.
“Funding for an apprenticeship through merSETA discretionary grants, for instance, amounts to R206 290,” says Kotzé. “It is this kind of money that can be made available to employers to utilise for staff training. Even training for unemployed learners can be applied for, so it’s not limited to their own employees. Both internal and external training counts for mandatory grants, from induction training for new employees, to an employee furthering their studies through a tertiary institution.”
Mandatory grant submissions
NEASA’s experienced skills development facilitators collaborate with a company’s team to plan and execute effective skills training strategies, including assisting with the submission of their Workplace Skills Plan/Annual Training Report (WSP/ATR) and liaising with the relevant SETA.
2025 deadlines
The legislative timeframe for mandatory grant submissions to SETA’s generally opens up around the end of January/February with a deadline of 30 April. Therefore, it’s important for companies to keep up-to-date with the requirements of the various SETA’s as this can vary quite significantly from SETA to SETA, even in terms of documentation requirements.
For further information, visit www.NEASA.co.za
