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AgriBEE TrAgriBEE TrAgriBEE TrAgriBEE Tr
Presentation to the
DATE: 17 September 2010DATE: 17 September 2010
VENUE: Parliament
Transformation Charter Transformation Charter Transformation Charter Transformation Charter
the Public Hearings on AgriBEE
DATE: 17 September 2010DATE: 17 September 2010
VENUE: Parliament – Cape Town
� Introduction
� Scope of Application for the
� AgriBEE Elements
� AgriBEE Beneficiary Base
Presentation OutlinePresentation OutlinePresentation OutlinePresentation Outline
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� Scorecards Variations: AgriBEE
� AgriBEE Scorecard: All Elements
� Enterprises Classification
� Enterprises’ Indicate AgriBEE
Levels
� SANAS Accredited Rating
Calculation
the AgriBEE Charter
Base
Presentation OutlinePresentation OutlinePresentation OutlinePresentation Outline
AgriBEE versus BBBEE
Elements - Weights, Indicators &Targets
Classification versus Compliance to the Scorecard
AgriBEE Status and Procurement Recognition
Rating and Verification Agencies for Scorecard
� Composition of the AgriBEE
� Progress made by the AgriBEE
� Progress report on the Study
� Challenges experienced by
Presentation Outline (cont…)Presentation Outline (cont…)Presentation Outline (cont…)Presentation Outline (cont…)
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� Challenges experienced by
� Implementation of the AgriBEE
� BBBEE compliance in the
� Concluding Remarks
� Way Forward
AgriBEE Charter Council
AgriBEE Charter Council
Study for EMEs and QSEs Thresholds
by the AgriBEE Charter Council
Presentation Outline (cont…)Presentation Outline (cont…)Presentation Outline (cont…)Presentation Outline (cont…)
by the AgriBEE Charter Council
AgriBEE Equity Fund
the Agricultural Sector
IntroductionIntroductionIntroductionIntroduction
• The AgriBEE Sector Charterstakeholders expressedbroad-based transformation
• It is the product of extendedamongst sector and relatedinitiated by the launch of the
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initiated by the launch of the
• AgriBEE Charter was developedBBBEE Codes of Good Practice,
- BBBEE Act No. 53 of 2003
- South African Strategic Plan for Agriculture of 2001
- Unique aspects specific to sector i.e. Land
• AgriBEE Charter was gazetted
• AgriBEE Charter was then
• AgriBEE Charter Council was
IntroductionIntroductionIntroductionIntroduction
Charter is a statement of intent whereintheir commitment towards the goals fo
transformation of the agricultural sector.
extended consultations and deliberationsrelated stakeholders over a number of years
the AgriBEE Framework in July 2004.the AgriBEE Framework in July 2004.
developed as guided by the Phase 1 &Practice, taking into effect:
BBBEE Act No. 53 of 2003
South African Strategic Plan for Agriculture of 2001
Unique aspects specific to sector i.e. Land
gazetted on 20 March 2008.
then launched on 4 April 2008.
was inaugurated on 5 Dec 2008.
Scope of Application for the Scope of Application for the AgriBEE Charter AgriBEE Charter
Scope of Application for the Scope of Application for the AgriBEE Charter AgriBEE Charter
� The primary production of agricultural products;
� The provision of inputs and services to enterprises engaged in
The scope of the AgriBEE Transformation Charter shall include any Enterprises which derives the majority of its turnover from:
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� The provision of inputs and services to enterprises engaged in the production of agricultural products;
� The beneficiation of agricultural products whether of a primary or semi-beneficiated form; and
� The storage, distribution, and/or trading and allied activities related to non-beneficiated agricultural products.
Scope of Application for the Scope of Application for the AgriBEE Charter AgriBEE Charter
Scope of Application for the Scope of Application for the AgriBEE Charter AgriBEE Charter
The primary production of agricultural products;
The provision of inputs and services to enterprises engaged in
The scope of the AgriBEE Transformation Charter shall include any Enterprises which derives the majority of its turnover from:
The provision of inputs and services to enterprises engaged in the production of agricultural products;
The beneficiation of agricultural products whether of a primary beneficiated form; and
The storage, distribution, and/or trading and allied activities beneficiated agricultural products.
AgriBEE ElementsAgriBEE ElementsAgriBEE ElementsAgriBEE Elements
Transforming the
Commercial sub-sectors
Ownership
Management
EmploymentEquity
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Addressing challenges of the commercial & developing sectors
Addressing challenges of
developing sector
Equity
Development
PreferentialProcurement
EnterpriseDevelopment
Poverty alleviation
AgriBEE ElementsAgriBEE ElementsAgriBEE ElementsAgriBEE Elements
Ownership
Management
EmploymentEquity
Direct participation in
EconomicActivities
(Shareholders &
Management
Team)
Development
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Equity
Skills
Development
PreferentialProcurement
EnterpriseDevelopment
Development of Human
Capital(Current &
prospective
employees)
Development &
Investment in
Affirmable
Enterprises
(Suppliers & communities)Poverty alleviation
The Business Barrier
The Opportunity Barrier
Preferential
Procurement
Ownership
& Management
Equitable Economic Opportunities
Enterprise
Development
AgriBEE Beneficiary BaseAgriBEE Beneficiary BaseAgriBEE Beneficiary BaseAgriBEE Beneficiary Base
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The Poverty Barrier
The Skills Barrier
Employment
EquityRD, PA & CSI
Skills Development
Emerging black middle class & investors
Black entrepreneurs
AgriBEE Beneficiary BaseAgriBEE Beneficiary BaseAgriBEE Beneficiary BaseAgriBEE Beneficiary Base
Black workers, professionals, graduates,
school-leavers
Black unemployed & rural poor
No Empowerment
Indicator
1 Ownership (Land and Equity)
2 Management Control
Scorecards Variations:Scorecards Variations:AgriBEE versus BBBEEAgriBEE versus BBBEEScorecards Variations:Scorecards Variations:AgriBEE versus BBBEEAgriBEE versus BBBEE
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3 Employment Equity
4 Skills Development
5 Preferential Procurement
6 Enterprise Development
7 Rural Development, Poverty
Alleviation and CSI
AgriBEEIndicative
Scorecard
Variance BBBEE
Generic
Scorecard
Ownership (Land and Equity) 20 points 0 20 points
10 points 0 10 points
Scorecards Variations:Scorecards Variations:AgriBEE versus BBBEEAgriBEE versus BBBEEScorecards Variations:Scorecards Variations:AgriBEE versus BBBEEAgriBEE versus BBBEE
10 points - 5 15 points
20 points + 5 15 points
Preferential Procurement 20 points 0 20 points
10 points - 5 15 points
Rural Development, Poverty 10 points + 5 05 points
Ownership
Management Control
Employment Equity
AgriBEE ScorecardAgriBEE ScorecardAgriBEE ScorecardAgriBEE Scorecard
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Employment Equity
Skills Development
Preferential Procurement
Enterprise Development
Socio-Economic Development
Weight
Ownership
Management Control
Employment Equity
20%
10%
10% Your company
AgriBEE ScorecardAgriBEE ScorecardAgriBEE ScorecardAgriBEE Scorecard
Employment Equity
Skills Development
Preferential Procurement
Enterprise Development
Economic Development
10%
20%
10%
100%
20%
10% The environment
Your supply chain
Ownership (20 points)Ownership (20 points)Ownership (20 points)Ownership (20 points)
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Ownership (20 points)Ownership (20 points)Ownership (20 points)Ownership (20 points)
Management Control (10 points)Management Control (10 points)Management Control (10 points)Management Control (10 points)
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Management Control (10 points)Management Control (10 points)Management Control (10 points)Management Control (10 points)
Employment Equity (10 points)Employment Equity (10 points)Employment Equity (10 points)Employment Equity (10 points)
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Employment Equity (10 points)Employment Equity (10 points)Employment Equity (10 points)Employment Equity (10 points)
Skills Development (20 points)Skills Development (20 points)Skills Development (20 points)Skills Development (20 points)
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Skills Development (20 points)Skills Development (20 points)Skills Development (20 points)Skills Development (20 points)
Preferential Procurement (20 points)Preferential Procurement (20 points)Preferential Procurement (20 points)Preferential Procurement (20 points)
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Preferential Procurement (20 points)Preferential Procurement (20 points)Preferential Procurement (20 points)Preferential Procurement (20 points)
Enterprise Development (10 points)Enterprise Development (10 points)Enterprise Development (10 points)Enterprise Development (10 points)
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Enterprise Development (10 points)Enterprise Development (10 points)Enterprise Development (10 points)Enterprise Development (10 points)
Rural DevelopmenRural DevelopmenCorporate Social Investment (10 points)Corporate Social Investment (10 points)
Rural DevelopmenRural DevelopmenCorporate Social Investment (10 points)Corporate Social Investment (10 points)
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ent, Poverty Alleviation and ent, Poverty Alleviation and Corporate Social Investment (10 points)Corporate Social Investment (10 points)
ent, Poverty Alleviation and ent, Poverty Alleviation and Corporate Social Investment (10 points)Corporate Social Investment (10 points)
� Exempted Micro Enterprisesof less than R5 millioncomplying with theempowered. They automaticallyLevel or status, and areblack-owned.
Enterprises Enterprises Compliance to the AgriBEE ScorecardCompliance to the AgriBEE Scorecard
Enterprises Enterprises Compliance to the AgriBEE ScorecardCompliance to the AgriBEE Scorecard
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� Qualifying Small Enterprisesof more than R 5 million,CHOOSE any four out ofand each element is weighted
� Large enterprises have anmillion, and they have toof the Scorecard.
Enterprises (EMEs) have an annual turnovermillion. They are FULLY EXEMPTED from
Codes, and are considered fullyautomatically have a Level 4 Contribution
considered at Level 3 if they are also
Enterprises Enterprises Classification vs. Classification vs. Compliance to the AgriBEE ScorecardCompliance to the AgriBEE Scorecard
Enterprises Enterprises Classification vs. Classification vs. Compliance to the AgriBEE ScorecardCompliance to the AgriBEE Scorecard
Enterprises (QSEs) have an annual turnovermillion, but less than R 35 million. They can
of the seven elements of the scorecard,weighted equally at 25%.
an annual turnover of more than R 35to comply with ALL seven components
Enterprises’ Indicate AgriBEE Status Enterprises’ Indicate AgriBEE Status and Procurement Recognition Levelsand Procurement Recognition LevelsEnterprises’ Indicate AgriBEE Status Enterprises’ Indicate AgriBEE Status and Procurement Recognition Levelsand Procurement Recognition Levels
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Enterprises’ Indicate AgriBEE Status Enterprises’ Indicate AgriBEE Status and Procurement Recognition Levelsand Procurement Recognition LevelsEnterprises’ Indicate AgriBEE Status Enterprises’ Indicate AgriBEE Status and Procurement Recognition Levelsand Procurement Recognition Levels
AgriBEE Contribution LevelsAgriBEE Contribution LevelsAgriBEE Contribution LevelsAgriBEE Contribution Levels
Contribution Levels % Points on Scorecard
Level 1 greater than 100 points
Level 2 from 85 to 99 points
Level 3 from 75 to 84 points
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Level 4 from 65 to 74 points
Level 5 from 55 to 64 points
Level 6 from 45 to 54 points
Level 7 from 40 to 44 points
Level 8 from 30 to 44 points
Non Compliant from 0 to 39 points
AgriBEE Contribution LevelsAgriBEE Contribution LevelsAgriBEE Contribution LevelsAgriBEE Contribution Levels
% Points on Scorecard Procurement Recognition (R1.00 spent =)
greater than 100 points R1.35
from 85 to 99 points R1.25
from 75 to 84 points R1.10
from 65 to 74 points R1.00
from 55 to 64 points 80 c
from 45 to 54 points 60 c
from 40 to 44 points 50 c
from 30 to 44 points 10 c
from 0 to 39 points 0 c
SANAS accredited Rating/Verification SANAS accredited Rating/Verification Agencies for Scorecard calculationAgencies for Scorecard calculation
SANAS accredited Rating/Verification SANAS accredited Rating/Verification Agencies for Scorecard calculationAgencies for Scorecard calculation
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SANAS accredited Rating/Verification SANAS accredited Rating/Verification Agencies for Scorecard calculationAgencies for Scorecard calculation
SANAS accredited Rating/Verification SANAS accredited Rating/Verification Agencies for Scorecard calculationAgencies for Scorecard calculation
Composition of the AgriBEE Charter CouncilComposition of the AgriBEE Charter CouncilComposition of the AgriBEE Charter CouncilComposition of the AgriBEE Charter Council
� Government,
� Agribusinesses,
� Agricultural Processors,
� Farmers Organisations,
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� Labour Unions
� Civil Society Organisations,
� Farmers Unions.
Composition of the AgriBEE Charter CouncilComposition of the AgriBEE Charter CouncilComposition of the AgriBEE Charter CouncilComposition of the AgriBEE Charter Council
Organisations, and
Progress made by the Progress made by the AgriBEE Charter CouncilAgriBEE Charter Council
Progress made by the Progress made by the AgriBEE Charter CouncilAgriBEE Charter Council
� Council drafted a detaileddiscuss and agree on the
� Council agreed to migrateAgricultural Sector
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� Council established 3 Working
�Working Group 1: responsible
Charter with the final DTI
Scorecard and their points’
Scorecards.
�Working Group 2: responsible
Activities of the Council
�Working Group 3: responsible
of a cost-effective monitoring
implementation.
Progress made by the Progress made by the AgriBEE Charter CouncilAgriBEE Charter Council
Progress made by the Progress made by the AgriBEE Charter CouncilAgriBEE Charter Council
detailed workplan and already met 6 times tothe workplan activities.
migrate the section 12 into 9 Sector Codes for
Working Groups as follows:
responsible for the alignment of the Sect.12
DTI Codes, check the 7 elements of the Generic
points’ allocation with the indicative AgriBEE
responsible for drawing up a Budget for the
Council.
responsible for the investigation and development
monitoring & reporting system on AgriBEE
Progress (cont…)Progress (cont…)Progress (cont…)Progress (cont…)
� Council agreed to commissionExempted Micro EnterprisesEnterprises (QSEs).
� Council made a commitmentCouncil Meeting and agreed
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� Council completed the alignmentDevelopment of AgriBEE IT
� Council investigated optionsfollows:
- STRUCTURE: Council Executing
Government (currently
Established Office with appointed
- FUNDING: 50-50 or 60-40
- Not yet finalized the decision
Progress (cont…)Progress (cont…)Progress (cont…)Progress (cont…)
commission a study to review thresholds foEnterprises (EMEs) and Qualifying Smal
commitment to complete a Draft Sector Code by nexagreed to gazette it parallel to the study.
alignment of AgriBEE Scorecard and theIT Portal is in progress.
options for structure and funding after Section
Executing Authority remaining under wing o
Secretariat to Council) or Independently
appointed CEO and staff.
(Government-Private Sector).
decision on the structure and funding.
Progress report on the Study for Progress report on the Study for EME and QSE ThresholdsEME and QSE Thresholds
Progress report on the Study for Progress report on the Study for EME and QSE ThresholdsEME and QSE Thresholds
� Following the Departmentalwas advertised two timeshowever all Bidders did not
� BID Evaluation Committeeundertake the study given
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undertake the study givenrecommended a proposalstudy for Council’s consideration
� Council supported the proposalstudy and tasked the Secretariatmodalities.
� NAMC appointment is still
Progress report on the Study for Progress report on the Study for EME and QSE ThresholdsEME and QSE Thresholds
Progress report on the Study for Progress report on the Study for EME and QSE ThresholdsEME and QSE Thresholds
Departmental Supply Chain processes, a tendertimes to appoint a suitable service provider,
not meet the requirements.
Committee evaluated various options togiven unsuccessful tender option andgiven unsuccessful tender option and
proposal to engage the NAMC to undertake theconsideration.
proposal to appoint NAMC to do suchSecretariat to facilitate the appointment
still in progress.
Challenges experienced by Challenges experienced by AgriBEE Charter Council AgriBEE Charter Council
Challenges experienced by Challenges experienced by AgriBEE Charter Council AgriBEE Charter Council
� Reporting on sector’s transformation is a difficult task under current Section 12 Charter status
� Unable to give statistics on Scorecard Targets & Indicators other than the basis information in the DTI’s BEE Portal
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� Statistics/ information on AgriBEE not available and not coordinated
Challenges experienced by Challenges experienced by AgriBEE Charter Council AgriBEE Charter Council
Challenges experienced by Challenges experienced by AgriBEE Charter Council AgriBEE Charter Council
Reporting on sector’s transformation is a difficult task under current Section 12 Charter status
Unable to give statistics on Scorecard Targets & Indicators other than the basis information in the DTI’s BEE Portal
Statistics/ information on AgriBEE not available and not
Implementation ofImplementation ofImplementation ofImplementation of
• Fund Objective: To providethe entry and participationvalue chain.
• DAFF entered into an MOA
• About R195 million was transferred
• About R85 million was spendfinance 13 equity projects
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finance 13 equity projectsdatabase .
• About R110 million hasmismanagement of the fund
• In order to unfreeze the fund,a new MOA on the AgriBEEAgriBEE Fund Operationalby both parties.
• Once the MoA is signed, thethe applications will be consideredrevised operational manual
of the AgriBEE Equity Fund of the AgriBEE Equity Fund of the AgriBEE Equity Fund of the AgriBEE Equity Fund
provide funding for equity deals that promoteparticipation of black people in the entire agricultural
MOA with Land Bank, as the Fund Manager.
transferred to the Bank: 2006/07 – 2009/10.
spend between 2006/07 and 2007/08 toprojects and 6 AgriBEE opportunity studies &projects and 6 AgriBEE opportunity studies &
been frozen due to the allegations offund by the Land Bank.
fund, DAFF and Land Bank have developedAgriBEE Equity Fund and also revised the
Operational Manual, which are on route for signature
the AgriBEE Fund will be operational andconsidered by the Land Bank in line with the
manual
Agricultural SecAgricultural SecRegistered EntitiRegistered EntitiAgricultural SecAgricultural Sec
Registered EntitiRegistered Entiti
• According to the DTI IT Portal as at 30 June 2010, there are 612 entities registered in the Agricultural Sector as follows:
�299 are Exempted Micro Enterprises (EME’s)
�231 are Qualifying Small Enterprises (QSE’s)
�82 are Large Enterprises (Generics)
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�82 are Large Enterprises (Generics)
�278 were not yet rated.
• Ownership status of the Registered Agricultural Entities:
�Average black ownership is 23%
�Average black women ownership is 10%
ector BBBEE Compliance: ector BBBEE Compliance: tities and Ownership Statustities and Ownership Statusector BBBEE Compliance: ector BBBEE Compliance: tities and Ownership Statustities and Ownership Status
According to the DTI IT Portal as at 30 June 2010, there are 612 entities registered in the Agricultural Sector as follows:
299 are Exempted Micro Enterprises (EME’s)
231 are Qualifying Small Enterprises (QSE’s)
82 are Large Enterprises (Generics)82 are Large Enterprises (Generics)
Ownership status of the Registered Agricultural Entities:
Average black ownership is 23%
Average black women ownership is 10%
Agricultural SecAgricultural SecStatus of the RegisStatus of the Regis
Agricultural SecAgricultural SecStatus of the RegisStatus of the Regis
Contribution Levels Number of Agricultural
Level 1
Level 2
Level 3
2828
Level 4
Level 5
Level 6
Level 7
Level 8
Non Compliant
ector BBBEE Compliance: ector BBBEE Compliance: gistered Agricultural Entitiesgistered Agricultural Entitiesector BBBEE Compliance: ector BBBEE Compliance: gistered Agricultural Entitiesgistered Agricultural Entities
Number of Agricultural Entities
% Points on Scorecard
31 greater than 100 points
20 from 85 to 99 points
74 from 75 to 84 points
161 from 65 to 74 points
12 from 55 to 64 points
16 from 45 to 54 points
6 from 40 to 44 points
6 from 30 to 44 points
8 from 0 to 39 points
Concluding RemarksConcluding RemarksConcluding RemarksConcluding Remarks
� “We must be the changeborn in India, but made
� “Socio-economic transformationimpossible”: Nelson Mandela
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� Given these remarks,currently on the transformationCodes (Section 9)
� This transformation roadmaptherefore require morestakeholders in the Agriculturalcan do more.
Concluding RemarksConcluding RemarksConcluding RemarksConcluding Remarks
change we wish to see in the world. I wasin South Africa”: Mahatma Gandhi
transformation is difficult but notMandela
remarks, AgriBEE Charter (Section 12) istransformation roadmap to AgriBEE Sector
roadmap has lot of turbulences andmore than 100% commitment from all the
Agricultural Sector: Working together we
Way ForwardWay ForwardWay ForwardWay Forward
� Council will facilitate thefrom December 2010.
� Council will facilitate thethe key agricultural stakeholders
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� Council will facilitate reportingwho falls under scope of
Way ForwardWay ForwardWay ForwardWay Forward
the gazette of AGRIBEE Sector Codes
the signing off of the Section 9 Code bystakeholders before the end of March 2010.
reporting by all agricultural stakeholdersthe AgriBEE Charter.
History confirms that people don’t believe the MESSAGE
3131
believe the MESSAGE
believe the MESSENGER.
I THANK YOU
History confirms that people don’t believe the MESSAGE until they believe the MESSAGE until they
believe the MESSENGER.
I THANK YOU