Wednesday, November 29, 2023

Companies warm up to HRDC training levy


While in 2016 the Human Resource Development Council (HRDC) was worried about the low uptake of the training levy, fast forward to 2019 the same cannot be said as tables have turned.

The council says there is growing on interest in the human resource development Fund or training levy. The number of companies and beneficiaries of the Fund continues to rise year in and year out according to Dr. Raphael Dingalo ÔÇô HRDC Chief Executive.

“On average 30,000 people are trained every year which makes it around a hundred thousand people have benefitted for the past three years.”

It is reported that HRDC has over the years been conducting stakeholder engagement initiatives to educate employers about the Fund. At the same, there is currently an impact research study ongoing to assess the successes and failures of the Fund. It is expected that the recommendations will be included in the current holistic review of the Fund.

Meanwhile in 2016 an amount of Two Hundred And Eighty Two million Pula was disbursed (P282million) of which a 61 percent being One Hundred And Seventy One million Pula (P171million) was utilised. The following year – 2017 a figure of Two Hundred And Ninety One million (P291 million) Pula was disbursed to the fund. From that amount only Two Hundred And Forty Nine million Pula was utilised of which (P249million) 86 percent of the fund.

In 2018 the Fund began with Three Hundred million Pula was disbursed and the HRDF managed to use only eighty six percent of the total amount.

On average for the past three financial years thirty thousand employees were trained in different work skills across various sectors of the economy.

Dr. Dingalo revealed that “employees were trained on work skills, various technical programmes in all sectors of the economy and on the structured apprenticeship programmes. This is particularly true for companies in the mining, transport, wholesale and retail industries.”

The HRDF is a levy based fund and the training levy is collected by Botswana Unified Revenue Services (BURS) from eligible companies through the Value Added Tax (VAT) system.

However the CEO has revealed to Sunday Standard that indeed the fund does experience challenges as well. He said “Overall utilisation of the fund among levy payers remains low especially among medium to small organisations. The reasons range from cash flow problems that manifest itself in the reimbursement model to lack of structured training plans.”

Other setbacks encountered by the fund are concerns raised by stakeholders, “some companies have pointed to the limited scope of the Fund to Vocational training as an inhibiting factor while others prefer organisation specific programmes (product related training programmes) which are not accredited,” the CEO continued.

Reviews are being considered for the fund in order for it maximise its impact and reach as the CEO shared that “the reimbursement regulations are being revised to make it easier for companies to utilise the Fund. Issues under review include reviewing the limited scope of training, ways to fund unaccredited but necessary product related training and to expand the structured apprenticeship programmes across economic sectors.”

HRDC is also engaged in an extensive exercise to assist companies understand the requirements of the Fund and develop concrete training plans,” CEO concluded.

Dingalo said “since extensive awareness campaigns were introduced in 2016 there has been a six percent (6%) increase in the uptake of the Fund from organisations, while funds utilisation (in monetary terms) for reimbursements year on year averages sixty six percent (66%).”


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