HR, Business and Budget 2009

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HR & Business

If someone had told you in 2006, that an economic catastrophe would sweep across your industry and organisation in 2008/9, would you have done anything differently in HR?  If you had known that doing business in Dubai, Durban or Detroit would be so different today, would you have managed talent differently?

Obviously, yes?  Maybe not?

In August 2006, Peter Schiff was a financial quack in the U.S that told viewers on CNBC, of the coming recession. Dubbed, “Dr Doom”, his warnings were dismissed by the public and companies alike. Who wants bad news, when the sun is shining and the official weather man of the day predicts eternal sunshine? Now Peter Schiff, speaks of the recession as being the solution, not the problem and that “soft-landing” interventions by government are going to prolong the pain. Not the type of tell-it-like-it-is-stuff that government or executives want to hear in times of dark clouds. Some of his other doom day forecasts; such as the US dollar going to zero, have not yet come to pass.

As organisations battle to make sense of the economic environment, it is critical that voices from different quarters are heard in your boardroom. If the only voice that you listen to; is that of executive group think and a best of breed consulting firm, the organisation is better of switching to mute. The 21st organisation must seek out the deviants, quacks and difficult voices of this day, with the courage to sometimes heed their warnings. If you have “Dr Doom” individuals in your organisation, can you really dismiss their opinions in these times of turmoil? What if, they are right? Their insights from the frontlines; could provide the solution for the business to survive the storms ahead. HR must provide the platforms and tools for these individuals to express their opinions, without fear of a career limiting move.

HR, working with line management, can achieve rapid gains, just by encouraging wider participation and collaboration across business units. The business needs HR to do what they have spoken about for a decade – be knowledge facilitators that draws upon the strengths of their workforce and relationship builders that unify the stakeholders for bottom line results.
Budget 2009

The 2009 Budget Speech was an impressive balancing act between conflicting interests of politicians, business and labour. On the one hand, depending on your income level, you will share in a tax bonanza of R13.6 million. The bulk of the tax relief goes to taxpayers earning less than R150 000 per annum. The other hand will give it away in the form of higher fuel, sin and electricity taxes.

Higher income earners are likely to give more away in future. The scrapping of deemed travel kilometres on 1 March 2010 and mooted medical tax credit system, could reduce their after tax income by thousands in future. Not to mention, the inconvenience of keeping a logbook of your business trips to claim against the travel allowance. Finally, don’t forget about the planned retirement and social security reforms by 2012. You will have a compulsory pension plan and potential tax caps on additional contributions. These changes may affect your monthly cash flow and the tax subsidy towards your future nest egg.

(HR Future, April 2009)

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