The Development Bank of Southern Africa (DBSA) said this week that the Jobs Fund investment committee has approved R352-million in cofunding for seven projects, which would create a projected 115 226 jobs.

The fund has received a total of 2 651 applications following its first funding period, which closed on July 31, totalling R320-billion worth of potential grant funding. Of these applications 1 641 were not eligible, seven were approved and 1 007 were still to be taken through the approval process.

The first recipients of the fund would receive disbursements as soon as all conditions of approval and contracting were finalised. Correspondence both to noneligible and successful applicants was being sent out to the relevant parties.

The fund was planning to disburse and approve a total of R2-billion worth of projects in the 2011/12 financial year.

Managed by the DBSA, the primary mandate of the R9-billion Jobs Fund, which Finance Minister Pravin Gordan launched on June 7, is to create sustainable employment by assisting in the expansion of existing business enterprises.

“The fund hopes to pilot innovative approaches to employment creation. It operates on the basis of a competitive process, allocating funds to projects that show promise and speak to the fundamental mandate of the fund – sustainable job creation,” the DBSA said in a statement.

Jobs Fund chief investment officer Dumisa Hlatshwayo stressed that the fund did not guarantee that a project would be approved because it created jobs.

“In some applications the required cofunding, which is a critical prerequisite for approval, was not taken into consideration at all. In certain instances, the applicants presented concepts, ideas or feasibilities, with no track record of implementation as required for approval by the fund,” Hlatshwayo said.

In an effort to educate and support the applicants, as well as striving to improve on the quality of future applications, the Jobs Fund would embark on provincial briefing sessions.

“We seek to meaningfully engage our stakeholders. These sessions will be used to share the lessons learnt during this current funding period, as well as to illustrate the entire Jobs Fund value chain. We will also deploy our project managers to provinces in order for them to be better accessible both to potential applicants, as well as to Jobs Fund grant beneficiaries,” Hlatshwayo said.

The Jobs Fund was announced in President Jacob Zuma’s State of the Nation speech in February, and is distinct from existing development financing instruments, such as the R10-billion Industrial Development Corporation loan facility, as it provided grants, rather than loans.

Government aims to create five-million new jobs over the next decade, and bring the unemployment rate down to 15%.