The Facility Investing for Employment (IFE) - an integral part of the Special Initiative "Decent Work for a Just Transition" - was created by KfW Development Bank (KfW) on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).
The main purpose of the Facility is job creation in the private sector and by this enhancing improved social protection. Grant funding is therefore available only for projects which will create new jobs in the private sector. Preference is given to projects, which combine job creation with improvement of social protection aspects of employees, their families or third parties.
While the primary goal of the Facility is the creation of new jobs, various aspects are taken into account in the selection of projects:
- Number of new good jobs and cost per job
- Number of existing employees who benefit from improved working conditions, social protection or income
- Number of people, participating in higher education or short-term job-related trainings
- Bonus criteria for number of jobs for women and youth, contribution to feminist development and just transition, synergies with other projects of the Special Initiative;
- Bonus criteria related to social protection measures;
- Number of people, who benefit from additional social protection measures co-financed by IFE.
Therefore, projects which first demonstrate sufficient job-creation potential may receive additional points in the evaluation process or even additional financial support for the implementation of social protection measures.
The Job Creation Component (compulsory)
The Facility only finances mature projects that have not yet started and that offer reasonable chances for being operationally and financially sustainable. Applicants are obliged to contribute own funds to complete the project finance. They must also prove that they cannot cover their funding needs from other sources.
The proposed investment project, which will lead to job creation, must fall within one of IFE’s four categories.
Social protection Component
In addition to the creation of new formal good jobs, IFE aims to support national efforts to improve the social protection of existing and new employees, their families, disadvantaged groups and people, who have a (semi-)formal business relationship with the applicant(s) such as independent sale agents, drivers or similar. Applicants, who will implement measures significantly above the national mandatory minimum requirements, can benefit from:
• Bonus points for the formalization of jobs or for social protection measures for new jobs above the mandatory minimum requirements, which will be implemented for new emplyoees by the applicant and its consortium partners:
• Financial support for additional new social protection measures above the mandatory minimum requirements, to boost both one-off and/or ongoing social protection expenses.
Applicants can apply for financial support in form of an additional grant for contributions to employer-(co)financed social protection schemes, including:
- Contributions to improved social protection of existing and new employees such as additional or new health, unemployment, accident insurances, pension schemes etc.
- Contributions to improved social protection of people not formally employed by the applicant or its consortium partners, but with a business relationship with these entities (e.g. independent sale agents, truck drivers, seasonal workers etc.).
- Transformation of existent informal schemes (e.g. company internal social funds) into formalised social protection product with a regulated provider.
- Investment costs for other social protection measures such as construction and equipment costs for the establishment of a Kindergarten, IT platforms for the registration and placement (with access to social protection schemes) of informal workers, health care centre, conversion of workplaces with the aim of making them more accessible for persons with disabilities.