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The Eastern Cape Development Corporation says it has approved R25m for disbursement from the Jobs Simulus Fund to 27 companies in the first two windows of applications.
Fund manager, Thabo Shenxane, says R6.7m has already been disbursed to 16 approved companies while they're still waiting for the rest of the approved companies to meet certain conditions for disbursement.
He says its estimated that 2450 jobs will be created and or retained by the 27 qualifying companies.
Shenxane says the third window for applications from the R39m jobs stimulus fund opened today and closes at the end of November.
"A total of 90 applications were received and processed in the first two windows, of which 27 companies were approved for funding. ECDC approved R12,1 million from the first window of applications and R12,4 million in the second window. A total of 19 companies were approved in the first window of applications followed by 8 in the second window. The approved companies mainly operate in the Business Process Outsourcing, Agroprocessing, Services and Manufacturing sectors," said Shenxane.
"There are certain conditions that have to be met by the approved businesses before disbursement takes place. These conditions include the submission of a memorandum of agreement signed between ECDC and the approved company, all employment contracts and certified copies of identity documents for the employees for whom the application was made; a current and compliant tax clearance certificate, proof of banking details and a copy of payroll,"he said.
The conditions also include a declaration by the entity that it complies with the Public Finance Management Act in terms of having suitable financial management systems in place"
"Qualifying businesses will be paid R10 000 per job created. The fund is meant to create sustainable new jobs located within the Eastern Cape by attracting sector-specific investments across the value chain. Applicants to the fund are measured according to the strategic impact of the jobs created, sector prioritisation, location and on skills development. All successful applicants are expected to sign a contract with ECDC before any funds may be disbursed."
"Shenxane says that of the 27 companies, two have since withdrawn citing reasons of an economic meltdown in their respective business environments. The two withdrawing entities were approved for a total of 18 jobs. He says the majority of the applicants who failed were start-up companies with no start-up capital."
"Most of the unsuccessful applications were not operating at the time of the application. Others were not legislatively compliant or had insufficient financial information to test solvency and sustainability or were basic business ideas.
"We are seeing a significant interest in the fund and anticipate the submission of more quality applications. In the last month and a half, the Jobs Fund team has engaged organized business structures and particularly the private sector to take advantage of this opportunity," adds Shenxane.
The incentive is only be available to businesses which operate within the province. The businesses which apply for the incentive are required to create at least 10 new jobs in the Eastern Cape. The company will be expected to maintain each job for a minimum of a year from the date of employment.
