BPO sector on target - DTI

April 21, 2011 11:01 am 0 comments

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The Department of Trade and Industry (DTI) has welcomed growth in the Business Process Outsourcing (BPO) sector saying recent investments of R40 million in the sector have already led to the creation of 950 new jobs.

According to Trade and Industry minister, Rob Davies, another R42 million in new investments has been committed and this is expected to create another 806 jobs for the sector.

He added that under the Monyetla II programme, 3 400 recruits are currently being trained of which 70% have been guaranteed employment by the BPO consortium.

Speaking on the role the sector plays in job creation plans, Davies added that positive outcomes are being realised and that targets would be reached.

Earlier this month, government introduced its Industrial Policy Action Plan (IPAP)2 – which details plans to improve SA as a key investment destination. IPAP2 identified BPO as a key sector for investment attraction and job creation and as a result the DTI reviewed its BPO incentive programme with the private sector and introduced new incentives.

According to the DTI, between July 2007 and March 2010, the incentive resulted in the creation of at least 6 000 new jobs and attracted R303 million in direct investment. The current incentive is effective from January 2011 to March 2014. The programme also includes the Monyetla Work Readiness Programme, which is aimed at improving service standards.

The revised BPO incentive includes a base incentive, which offers a three-year operational expenditure (Opex) grant that tapers down in line with the narrowing cost gap between SA and other destinations. It also includes a graduated bonus incentive, which is offered for greater job creation, if the applicant exceeds certain annual offshore job creation targets.

Companies will receive a total grant of R112 000 per offshore job created and sustained over a three year period for offshore jobs created from inception to the end of the 2011/12 financial year. This will decrease to R104 000 per offshore job s created during the 2012/13 financial year and will eventually go down to R88 000 for the 2013/14 financial year.

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