Transcript Title Page

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Clothing and Textiles Competitiveness Programme (CTCP)
Production Incentive Programme (PIP)
Presented by: EUKERIA CHIWARA – Account Manager CTCP
17th MAY 2013
THE PARTICIPATING SECTOR
The PIP is an incentive offered to:
Clothing manufacturers;
Textiles manufacturers;
Footwear manufacturers;
Leather goods manufacturers and
Leather processors (Specifically for Leather
Goods and Footwear industries);
• Related Cut, Make and Trim (CMT) operators;
•
•
•
•
•
• And related Designers.
- (The Sector)
NOTE: The Production Incentive specifically excludes
any Leather and Leather Goods manufactured for the
automotive sector.
OBJECTIVE
• aimed at creating sustainable
capabilities and employment in
The Sector;
• The main objective of the PIP is to
assist The Sector in upgrading
processes, products, people and to
re-position it so it competes
effectively against other low cost
producing countries.
BUDGET ALLOCATION
• Annual Programme, running from
1 April 2010 to 31 March 2016.
Budget allocations
Budget Year
FY2010/11
FY2011/12
FY2012/13
FY2013/14
FY2014/15
FY2015/16
Totals
Allocation
400,000,000
600,000,000
750,000,000
682,425,000
723,369,600
855,642,600
4,011,437,200
Applications cut off date – 31 Jan
each year
BENEFIT CEILING - GRANT
• Benefit Ceiling = 7.5% of a company’s
Manufacturing Value Addition (MVA) for the
year ending March 2014 .
• The MVA will be calculated as follows:
MVA =
Sales (Goods manufactured locally by the
company only)
Less
Material Input Costs (Used in the manufacturing
process).
THE PRODUCTION INCENTIVE (PIP)
The Benefit Ceiling utilisation;
Benefit Ceiling (BC)
Upgrade
Grant
(Competitiveness
Improvement)
Interest
Subsidy Max 50% of
CIP Own
BC
Contribution
(Working
Capital) –
• Applicants can either use the full benefit for the
Upgrade Grant Facility or up to 50% of their benefit for
the Interest Subsidy Facility or a combination of both.
THE PRODUCTION INCENTIVE (PIP)
UPGRADE GRANT FACILITY
• The Upgrade Grant is available to provide
financial support to the Sector to assist it in
attaining higher levels of competitiveness.
Equipment
Upgrade
Certain
Market
Development
People /
Skilling
Upgrade
Grant
Facility
Material
Usage Optimization
Process
Improvement
Product
Development
DETAILED PROGRAMME DESCRIPTION
UPGRADE GRANT FACILITY
• The Upgrade Grant can partly be used in
conjunction with the CIP.
• Beneficiaries have the option of using it
towards funding their own contribution
towards CIP. (Please refer to the CIP
guidelines for details).
• Companies that have existing loans from
any financial institution to fund expenditure
for purposes that would have qualified
under the Upgrade Grant facility will be able
to utilise their Upgrade Grant to settle or
partially settle these loans.
• Other IDC Facilities
DETAILED PROGRAMME DESCRIPTION
INTEREST SUBSIDY FACILITY FOR
WORKING CAPITAL
• An Interest Subsidy equal to the
ruling prime interest rate will be
made available to participating
companies.
• The Interest Subsidy may not
exceed 50% of the Benefit Ceiling.
MANDATORY CONDITIONS
• The applicant must be a registered legal
entity in South Africa.
• The operations of the company applying
must be classifiable as manufacturer (SIC
code 3) in terms of the ‘Standard Industrial
Classification of all Economic Activities’ or a
designer.
• The applicant must be a taxpayer in good
standing and must, in this regard, provide a
valid tax clearance certificate before the
grant is disbursed.
MANDATORY CONDITIONS
• The Applicant should be bargaining council
compliant.
• The applicant must comply with all relevant
environmental regulations, applicable to its
operations.
• Should the company have any pending
litigation against it, the outcome of which
may have a material impact on the
company’s financial position, then this
needs to be brought to the attention of the
CTCP Desk at time of application.
APPLICATION PROCESS
• In order to access the PIP, companies
need to apply to the CTCP Desk at the IDC
by;
Properly completing a Benefit Ceiling
Application Form 1 FY2013/14, Redemption
Application Form 2, Monitoring & Evaluation
Questionnaire Form 3 and Employment Data
Form 4, ensuring that contents of the forms
are not amended.
Submitting all documentation as required per
the documentation checklist on the Form 1
whilst ensuring that the relevant boxes are
ticked as information is provided.
 Emailed and / or incomplete applications
will ultimately be rejected.
ASSESSMENT & APPROVAL PROCESS
STAGE 1: ORIGINAL
APPLICATIONS
Original applications received
through IDC Records Dept.
Emailed confirmation sent to client
YES
YES STAGE 2: BASIC
ASSESSMENTS
YES
STAGE 3: DUE DILIGENCE
YES
STAGE 4: PREPARATION
OF SUBMISSION REPORT
CTCP desk to communicate in
advance with regards to the
Due Diligence that is to be
carried out at the clients
Application assessed by CTCP
Desk to ensure that all required
information has been provided.
CTCP Desk to communicate
to client with regards to
application submission cut off
times to be presented at the
monthly Projects Approval
Panel (PAP) meeting
business premises.
NO
INDICATIVE TIMELINES
STAGE 1:
2 WORKING DAYS
STAGE 2:
5 WORKING DAYS
Application Declined. End of
process.
Incomplete Applications
returned to Client.
NO
2 WORKING DAYS
STAGE 6:
7 WORKING DAYS
STAGE 7:
2 WEEKS
NO
STAGE 5: PAP MEETING
Application Resubmitted after
further information required by
PAP
STAGE 3 & 4: 5 WEEKS
STAGE 5:
YES
YES
STAGE 7: CLAIM PROCESSING
YES
Signed claim form on the
company’s letterhead and
supporting documentation to be
provided to the CTCP desk
STAGE 6 : LEGAL AGREEMENTS
Signed legal agreements to be returned
back to the IDC within 7 working days.
NO
Application submitted to
Project Approval Panel
meeting.
YES
REDEMPTION PROCESS
• Applicants wishing to access their approved
funds have to submit a completed
redemption application form 2 at the time of
application.
• The redemption application must be
accompanied by a proper description of the
historical or planned qualifying interventions
of the applicant.
• Redemption claims in the form of invoices
on upgrading expenditure may be
submitted to the CTCP desk for
reimbursement of approved upgrade
expenditure already incurred or for payment
of approved upgrade expenditure to be
effected.
VALIDITY OF BENEFIT CEILING
• The claims must be paid out within a period
of twenty four (24) months from the
approval date, otherwise the funds expire.
Any benefit remaining on the Client’s
account with IDC after the termination date
will be cancelled.
• Upgrade Grants made by the programme
will be made exclusive of Value-Added Tax
(VAT).
DISBURSEMENTS
• Payments shall be made directly into the
bank account of the approved receiver,
whether it be the applicant (on
reimbursement of expenditure already
effected) or a supplier of goods or services
to be expended. The name of the account
holder must be the same as that of the
approved receiver.
• On adjudication of an Interest Subsidy, the
CTCP desk will pay the amount of the
Interest Subsidy directly into the applicant’s
account.
EXCLUSIONS AND LIMITATIONS
• Eligible projects that would have demonstrated
economic viability and sustainability will be
financially supported only if the upgrading
investment costs could be linked directly to
productivity and competitiveness improvement
activities in a company.
• The following are examples of costs that do
NOT qualify under the Upgrade Grant:
– Normal operating costs will not be
considered for support.
– Staff costs will not be considered for
support.
– Upgrading of vehicles will not be considered
for support.
THE CTCP DESK
• The CTCP Desk has been established at
the IDC to administer the CTCP.
• The CTCP Desk resides within the
Development Funds Department (DFD) of
the IDC.
The members of the CTCP Desk are:
Mr Joy Balepile
- Programme Manager
Ms Eukeria Chiwara - Pre - Account Manager
Mr Khothatso Khoapa – Pre - Account Manager
Mr Nduma Maluleka - Pre - Account Manager
Mr Kagiso Matswalela – Pre - Account Manager
• The DFD was established in 2001 to
manage ring-fenced funds within IDC.
Mr Patrick Matlhola
- Pre - Account Manager
Ms. Phemelo Koloti
- Post Account Manager
Mr. Makweng Nkoana – Post Account Manager
Ms. Zandile Nyangane – Post Account Manager / Admin.
Ms Gillian Venter
- Administrator
Thank You
Ms. Eukeria Chiwara - Account Manager:
Tel:
+2711 269 3424
+2711 269 3000
Fax:
+2711 269 3126
Email:
[email protected]
The Industrial Development Corporation
19 Fredman Drive, Sandown
PO Box 784055, Sandton, 2146
South Africa
Telephone (011) 269 3000
Facsimile (011) 269 2116
E-mail [email protected]